The central government is open to take the industry’s proposal on reducing the Goods and Services Tax (GST) on automobiles to the GST Council.
Speaking at the ACMA annual convention here on Friday, Minister of State for Finance and Corporate Affairs Anurag Thakur said the government had received several representations from various stakeholders, including automobile dealers, OEMs and car manufacturers, regarding the reduction in GST rate from 28 per cent to 18 per cent.
The industry has demanded that the GST should be brought down to 18 per cent to reverse the consumption slowdown. The Minister asked the auto industry players to reach out to the State Finance Ministers as well as the decision on any change in GST can only be taken by the GST Council.
“Any rate cut in the GST needs to be first approved by the GST Fitment Committee and then by the GST Council. I request all of you to also reach out to State Finance Ministers, who are part of the GST Council. We are open taking it (rate cut proposal) to the GST Council, deliberate it there and most of the decisions are unanimously been taken in the previous GST Council meetings,” he said.
The GST council’s next meeting is scheduled in Goa on September 20.
The automobile sector is suffering a sales downturn due to factors like high GST, farm distress, stagnant wages, and liquidity constraints. Inventory pile-up and stock management of unsold BS-IV vehicles too have become a problem for the sector.