Government Mulling On Reducing Tax Rates For Passenger Vehicles
By Shubham Parashar
1 mins read
Published on September 3, 2019
- Automakers have been witnessing sales decline month after month.
- SIAM and other automakers have asked for immediate reduction in GST rates
- Finance Minister will speak to the GST council.
There has been no sign of recovery in auto sales and month after month automakers are recording decline in sales. The situation needs government intervention for the market to revive. After reviewing the economic slowdown and the mayhem in the auto sector, the government did announce measures to infuse more capital in the market in a bid to improve the cash flow which would uplift customer sentiments. While those steps may be effective over a period of time, the industry needs an emergency fix to stop further deterioration of volumes and it looks like the government is acknowledging it as well.
SIAM and several automakers have asked the government to reduce the GST rates on passenger vehicles and peg them under 18 per cent tax slab instead of 28 per cent which is the highest bracket. Speaking to the media in Chennai, Nirmala Sitharaman- Finance Minister of India said, "The tax cut proposal has got to go to the GST Council, where all state finance ministers assemble. It is for them to take a call. I have told them (automakers) that I will take it to the Council but the final decision will be theirs. I will wait for the GST Council to take a call."
Along with working on improving the liquidity flow in the economy, the government also took some specific measures after delegation from SIAM met the Finance Minister last month. Measures like resuming purchase of new vehicles by government departments, 15 per cent higher depreciation on vehicles and postponing one-time vehicle registration hike to June 2020 were announced. While the measures may help in the long run, carmakers are asking for a reduction in GST rates to keep a check on the prices. Vehicles across segments are likely to become more expensive once BS6 norms kick in April 2020 onwards. Many have already lost their jobs and around 10 lakh jobs are at stake owing to the biggest downturn the industry has seen in almost two decades.
Great Deals on Used CarsView All Used Cars
- 62,123 km
- 61,234 km
- 61,000 km
- 44,123 km
- 49,231 km
- 62,091 km
- 25,000 km
- 68,000 km
- 56,000 km
- 16,123 km
-13189 second ago
A strong push during the festive season helped Ola Electric achieve its highest-ever monthly sales, retaining its number-one position in the market.
-10827 second ago
Gauhar Khan and her husband, Zaid Darbar, were pictured together at the dealership in Mumbai while taking delivery of their new Mercedes.
-10157 second ago
Hero MotoCorp’s cumulative sales for November 2023 stood at 491,050 units, witnessing a 25.61 per cent increase year-on-year
-8270 second ago
-7692 second ago
The bikemaker’s cumulative motorcycle sales for the year 2023 stood at 621,672 units, reflecting a 13 per cent increase.
-5498 second ago
In the previous month, the automaker sold a total of 11,891 units, marking a growth of 24 per cent as compared to the same month last year.
-1788 second ago
At present, India’s largest carmaker holds just a little over 2.06 lakh open bookings, nearly a third of which are for the Ertiga.
39 minutes ago
New variant of the Chetak scooter gets some changes as compared to the Premium variant currently on sale.
1 hour ago
The cumulative sales for the Calendar Year 2023 reached 2,10,497 units - a 40 per cent growth over 2022
2 hours ago
While sales were up in comparison to November 2022, Ather reported a 7 per cent decline in sales as compared to October 2023
23 hours ago
Hyundai has witnessed a month-over-month decline of 4.2 per cent in sales as compared to the month of October 2023
1 month ago
Electric vehicles showcase a continued contribution to sales, accounting for 25 per cent of the total sales
1 month ago
The company's overall auto sales for the month reached 80,679 vehicles, marking a 32 per cent growth, including exports
2 months ago
Sales were up across all segments year-on-year though two-wheeler sales were down 11 per cent over pre-COVID levels.
11 months ago
In December 2022, Kia India registered 15,184 unit sales in the domestic market which is a growth of 94.7 per cent.