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COVID-19 impact: Centre mulling GST rate cut for auto sector, says Prakash Javadekar

Speaking at the virtual 2020 SIAM Annual Convention, Union Minister Prakash Javadekar said that the Centre is looking at a constriction of (GST) rates by 10 per cent for vehicles across all categories

twitter-logoBusinessToday.In | September 4, 2020 | Updated 18:47 IST
COVID-19 impact: Centre mulling GST rate cut for auto sector, says Prakash Javadekar
Heavy Industries and Public Enterprises Minister Prakash Javadekar was speaking at the 60th Annual Convention of industry body Society of Indian Automobile Manufacturers (SIAM)

Heavy Industries and Public Enterprises Minister Prakash Javadekar said on Friday that the government is considering a reduction in the Goods and Services Tax (GST) for the automobile sector. He added that the Centre is looking at a constriction of GST rates by 10 per cent for vehicles across all categories.

Speaking at the virtual 2020 SIAM Annual Convention, the union minister added that an announcement regarding this will be made soon.

Javadekar further stated that the Centre is working in this this direction with all stakeholders on ways to boost demand in the sector.

Also Read: Prakash Javadekar assures broadcasters of regulatory stability

He also said the government may soon come out with a scrappage policy while the Champion export scheme is also afoot.

"The auto industry has done a commendable job towards migrating to the BS6 norms, four years in advance, and are finding ways to overcome the challenges posed by the COVID-19 pandemic," Javadekar stated.

He also specified that several ministries have put together certain pandemic specific measures for each sector and submitted them to the Finance Ministry, and once all are ready, the government will then prioritise the same.

Also Read: GST reduction, scrappage policy to help revive commercial vehicle industry: Ashok Leyland

Talking about the electric vehicles (EVs), Javadekar noted that EVs are caught in a chicken and egg situation, however the Centre is scaling up the establishment of charging infrastructure with the help of private players.

Domestic automobile sector has been badly affected by the coronavirus outbreak. The pandemic has worsened the demand in the industry, which was battling a slowdown even before COVID-19 hit, forcing auto companies to pitch for incentives to revive demand.

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