GST will pave way for a better automotive market in India: SIAM president

Hailing the Centre's decision over new Goods and Service Tax (GST) rates on automobiles, the Society of Indian Automobile Manufacturers (SIAM) president Vinod Dasari said that the introduced rates will pave for stimulating demand and strengthening the automotive market in the country.

"The rates are as per the expectations of the industry and almost all segments of the industry have benefitted by way of a reduced overall tax burden in varying degree, which will pave the way for stimulating demand and strengthening the automotive market in the country, paving the way for meeting the vision laid down in the Automotive Mission Plan 2016-26," said Dasari.

"The government has done well to ensure stability in taxation while at the same time moderating the taxes wherever they were too high," added Dasari while expressing his delight over the new taxation rates.

He further said that the differential GST for electric vehicles will also help electric mobility to gain momentum in India.

"We would have liked to see a similar differential duty on hybrid vehicles to continue," he said.

Adding to this he said that the govt. has always encouraged environmentally friendly technologies and with the current focus on reducing emissions of greenhouse gases and reducing carbon footprint one would have expected the lower taxation to continue on such vehicles in a technology agnostic manner.

"The inclusion of 10-13 seater-vehicles used mainly for public transport in the same tax bracket as luxury cars with a 15 percent cess is also unexpected and may merit a review," added Dasari.

Earlier, Union Finance Minister Arun Jaitley said that the GST Bill, which is to exempt the daily-use commodities from the levy, is going to be more efficient and a consumer friendly taxation system.

"Four different rate slab for services are five percent, 12 percent, standard rate of 18 percent and luxury rate of 28 percent, out of which five percent mostly comprises of transport services," Jaitley said while addressing the media in Srinagar.

"Other services are fitted into rates such as 5, 12, 18, and luxury rate of 28 percent," he said while announcing that five percent rates comprises of transport services.