TIL Desk/Business/New Delhi/ Automobile dealers’ body FADA has urged the government to reduce GST rates on two-wheelers to 18 per cent in order to generate demand in the segment.
The Federation of Automobile Dealers Association (FADA), which represents over 15,000 automobile dealers having 26,500 dealerships, noted that two-wheelers are not a luxury item and hence GST rates need to come down.
“FADA requests the Ministry of Finance to regulate and reduce GST rates on two-wheelers to 18 per cent and continue to move our nation to global leadership,” the industry body stated on Monday.
Finance Minister Nirmala Sitharaman is scheduled to present the Union Budget 2022-23 in Parliament on February 1. It is noteworthy that two-wheelers are used not as a luxury thing but as a necessity to travel distances, especially by people in rural areas, for their daily working needs, it added.
“Hence the rationale of 28 per cent GST + 2 per cent cess which is for luxury/sin products does not hold good for the two-wheeler category,” FADA noted. At a time when vehicle prices are increasing after a gap of 3-4 months due to rise in input costs and various other factors, a reduction in the GST rate will counter the price hike and help spur demand, it added.
