Kolkata, Oct 28 (IANS): Mahindra Electric expects the government will not consider electric vehicles as luxury items in the proposed Goods and Services Tax (GST) regime as these promote pollution-free transportation, a company official said on Friday.

"Any new technology will not fall into luxury segment, when it is meant for pollution-free transportation and for the common people. Not only Mahindra, automobile manufacturers are giving representations to the government that it is a new technology. I do not think they have any intention to put electric vehicle in the luxury segment. We have not got any indication as such," said company's CEO-designate Mahesh Babu. 

Price is not the only criterion to define a product as a luxury item, he said.

"There are many components to determine and define whether a product will fall in the luxury or economy segment. We believe electric vehicles will not be considered a luxury item. We hope GST will be designed appropriately to promote electric vehicles in India," said company's Vice-President Dharmendra Mishra, who is also the Head, Sales, Marketing and Customer Care, after launching new electric car 'e2o Plus' in the city.

The company has been aggressive with launches of electric vehicles -- e-Verito, e-Supro van and now the e2oPlus.

Being an all-electric car, customer will also get the special incentives offered by the central government under the FAME (Faster Adoption and Manufacturing of Hybrid and Electric) initiative. 

The government is providing Rs 1.24 lakh incentive for each unit of this newly launched electric car. If the incentive amount goes up, prices will also come down, Babu said.

The company expects to double the sales of its electric vehicles in the current fiscal as compared to last year's sales, the officials said.