Thursday, November 19, 2020
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Expecting GST Rate Relief to The Auto Sector is Difficult

Continuos decrease in the demand when it comes to auto sector continues. The decrease in demand is at a low level in the last two decades. In such a situation, the people of the auto sector have demanded a reduction in the GST rate from the government. GST Council is scheduled to meet on 20 September. Recently, Minister of State for Finance Anurag Thakur said that the Central Government wants the rate to be reduced, but in this case, the Central Government cannot make a decision individually.


Let me tell you, the decision to reduce or increase the rate is taken in the GST Council, which also includes the representatives of the state. In such a situation, it also depends on the states to a large extent whether they are in favor of it or not. According to information received from sources, many states have opposed the rate cut. In such a situation, there is little hope that the auto sector will get relief in the GST rate in the meeting to be held on 20 September. If it is also assumed that the rate cut is announced, then it will take some months to see its effect. At the moment, dealers have the challenge to clear the old stock.


On the other hand, if we look at the sales figures, it is worrying. According to SIAM data for August, there has been a decline of 23.55 percent in total sales. There has been a 41 percent decline in the passenger car, 31.57 percent decline in a total passenger vehicle, 38.71 percent decline in the commercial vehicle, 6.93 percent decline in three-wheeler vehicle and 22.24 percent decline in sales of two-wheeler vehicle.

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