Bikes, scooters are not sin good or luxury item, says FADA, seeking GST rate cut

Automobile dealers’ body FADA on Thursday sought a cut in GST on two-wheelers from 28 per cent to 18 per cent, saying the segment being essential for millions should not be categorised as luxury item. The industry body said it has appealed to the finance minister, chair of the GST Council, all GST Council members, the ministry of heavy industries, which supervises the automobile sector, and the ministry of road transport & highways.

This timely and decisive intervention would help in making two-wheelers more affordable, reviving demand and reinvigorating an industry that has seen a significant slump in sales over the past few years, the Federation of Automobile Dealers Associations (FADA) said in a statement. “The two-wheeler industry is at a critical juncture, grappling with unprecedented challenges such as rising inflation, stringent emission norms and the post Covid-19 effects. Now is the opportune moment for the GST Council to reduce the GST rate on two-wheelers, making them more accessible for the common man,” FADA President Manish Raj Singhania said in a statement.

The tax cut will provide the much-needed boost to the industry, help in generating employment opportunities and fostering India’s overall economic growth, he added. Two-wheelers play a pivotal role in providing affordable mobility to a large segment of India’s population, especially in rural areas where public transportation is sparse, the industry body stated. “FADA strongly asserts that two-wheelers, being essential for millions, should not be categorised as sin goods or luxury items for GST taxation purposes,” it said.

Source: https://auto.hindustantimes.com/auto/two-wheelers/fada-seeks-gst-rate-cut-on-two-wheelers-proposes-18-tax-41684412229530.html