Passenger Vehicle GST Cut
Cars currently attract 28 percent GST with cess on top of that

The passenger vehicle industry will benefit from Goods and Services Tax (GST) cut as it will offset some of the price increase that came about as a consequence of the transition to BS6 norms, Tata Motors has said.

President of Passenger Vehicle Business Unit, Tata Motors, Shailesh Chandra, according to a PTI report, has said that there has been a significant escalation in cost due to the change from BS4 to BS6.

Further, there has been an increase in vehicle prices that “definitely impacts the industry immensely”, he stated.

Couple that with the outbreak of COVID-19 and customers are not confident about how their future is going to look like and that includes their jobs and salaries, said the top Tata executive.

Chandra feels that any support by the government to reduce GST to offset some of the price increase will “definitely boost the whole passenger vehicle industry”.

The carmaker claims people are going through low buying sentiments due to the precarious outlook for the economy. Currently, automobiles attract GST of 28 percent with an additional cess ranging from 1 to 22 percent.

India transitioned to BS6 emissions norms on 1st April 2020, only a few days after the first nationwide lockdown was implemented in the year.

Almost all firms posted zero sales in April and were hit hard, especially when they had put in around Rs. 40,000 crores, and auto components industry invested Rs. 30,000 crores, to adapt to the new and cleaner tech.

Car sales, over the past few months, have bounced back strongly, but the industry feels that a passenger vehicle GST cut would help get things back on track fast.

Passenger Vehicle GST Cut

  • Tata Motors says government support in reducing car GST will help industry
  • Adds that it will help offset increased prices due to adoption of BS6 tech
  • COVID-19 has derailed buying sentiment of consumers, it states
The transition to BS6 norms, coupled with the pandemic has hit carmakers hard