Hero MotoCorp seeks GST cut on two-wheelers to promote mass mobility
Hero MotoCorp wants the Centre to rethink the GST rate structure on two-wheelers in India. Pawan Munjal, Chairman of India's largest two-wheeler manufacturer, has sought reduction in GST rates on bikes and scooters in both ICE and electric two-wheeler segments in the country. He has urged the Centre to reduce the GST rate from 28 per cent to 18 per cent. His remarks come at a time when the two-wheeler industry in India has witnessed subdued sales over the last few years. Hero MotoCorp wants the Centre to back the segment through reduced tax burden on buyers.
Reacting to Budget 2023, presented by Finance Minister Nirmala Sitharaman on Wednesday, Pawan Munjal said two-wheelers cannot be put in the same bracket as luxury or sin goods. "There is a clear case for reducing the GST slab from 28 per cent to 18 per cent for the two-wheeler category, which has been adversely impacted over the past few years. This category is a means of mass mobility and should not be clubbed along with the luxury and sin goods category for GST slabs," he said. "Further, now that the GST collections are buoyant, I urge the GST council to take this up since this segment is an income multiplier and its growth will boost the economy," Munjal added.
While praising some of the other proposals in the Budget 2023, the two-wheeler manufacturer said decision to lower tax slabs is expected to offer more disposable income for buyers. This could eventually help boost growth in the auto sector and help the two-wheeler segment benefit in the process as well.
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While proposing several measures for the auto sector, especially for electric vehicle manufacturers, Finance Minister Nirmala Sitharaman did not heed to demands of reducing GST rates on vehicles. It has been a long-standing demand from the auto sector to revise the rates, which remains similar for both mass market and niche models sold in the country. Earlier, the Federation of Automobile Dealers Association (FADA) has requested the government to reduce the GST rates on two-wheelers by 18 per cent to stir demand in the segment.
