Parliamentary panel suggests lower GST rate, uniform road tax for auto sector until its revival

A parliamentary panel had examined the Demands for Grants 2020-21 of Department of Heavy Industry (DHI) and tabled its report in Parliament

Press Trust of India March 04, 2020 07:43:53 IST
Parliamentary panel suggests lower GST rate, uniform road tax for auto sector until its revival
  • parliamentary panel had examined the Demands for Grants 2020-21 of Department of Heavy Industry (DHI) and tabled its report in Parliament.

  • Amid a slowdown in the sector, the committee, among other things, recommended to either suspend or postpone the upfront payment of insurance for 5 years for the time being and reduction in GST rate to a lower slab "at least till the revival of the auto sector"

  • The report said the committee "is pleased to note" that the Delhi-Chandigarh highway has been declared as the first e-vehicle friendly expressway of the country

New Delhi: A parliamentary panel on Tuesday suggested a lower GST rate for the automobile segment at least till the revival of the sector and uniform road tax across all states against the backdrop of negative growth in the automobile production since July 2018.

A parliamentary panel had examined the Demands for Grants 2020-21 of Department of Heavy Industry (DHI) and tabled its report in Parliament.

The automobile industry in India is one of the largest and fastest-growing sectors and constitutes 27 percent of industrial gross domestic product (GDP) and 49 percent of manufacturing GDP. It provides about 37 million direct and indirect jobs and 15 percent of total GST collection amounting to Rs 1.5 lakh crore.

"But, the committee observes that of late, there is negative growth in the automobile production since July 2018," said the report.

Parliamentary panel suggests lower GST rate uniform road tax for auto sector until its revival

Representational image. AFP

The committee noted that some of the factors that contributed to slowdown are non-availability of credit facility to consumers, stringent rules for loan sanction by banks, rise in price due to the upfront payment of third-party insurance for 5 years, introduction of BS-VI vehicles from April 2020; and higher rate of GST on automobiles and components.

Amid a slowdown in the sector, the committee, among other things, recommended to either suspend or postpone the upfront payment of insurance for 5 years for the time being and reduction in GST rate to a lower slab "at least till the revival of the auto sector".

Further, it made a case for the introduction of incentive-based scrappage policy for creating purchase demand for new vehicles, reduction in import duty on lithium-ion cell battery which is used for operating the e-vehicles and levy of uniform road tax across all states.

The report said the committee "is pleased to note" that the Delhi-Chandigarh highway has been declared as the first e-vehicle friendly expressway of the country.

It desires that other expressways, including Delhi-Jaipur and Mumbai-Pune expressways, may also be made completely e-vehicle friendly soon with charging infrastructure in place at regular and frequent intervals.

Updated Date:

also read

GIC Recruitment 2021: Admit cards for assistant manager exam released on gicofindia.com
India

GIC Recruitment 2021: Admit cards for assistant manager exam released on gicofindia.com

The selected candidates will be initially posted in Mumbai Head Office but later they can be re-assigned to any part of the country

Retail inflation jumps to 5.52% in March; factory output contracts 3.6% in February
Business

Retail inflation jumps to 5.52% in March; factory output contracts 3.6% in February

The manufacturing sector — which constitutes 77.63 percent of the IIP — declined by 3.7 percent in February 2021, as per NSO data

Amid COVID-19 case surge, leading brokerages downgrade India’s GDP forecast for FY22
Business

Amid COVID-19 case surge, leading brokerages downgrade India’s GDP forecast for FY22

While Nomura has downgraded projections of economic growth for the fiscal year ending March 2022 to 12.6 percent from 13.5 percent earlier, JP Morgan now projects GDP growth at 11 percent from 13 percent earlier