Ball in FinMin’s court over GST rate cut for automobiles, says Gadkari

| | new delhi
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Ball in FinMin’s court over GST rate cut for automobiles, says Gadkari

Thursday, 12 September 2019 | PTI | new delhi

nUnion minister Nitin Gadkari on Wednesday said it was up to the Finance Ministry along with state governments and GST Council to decide on reduction in GST rate for automobiles and that he had already spoken to the Finance Minister in this regard.

The Road Transport and Highways Minister also said a scrappage policy, which also includes two-wheelers, is in the works and will be launched soon.

Last week at the SIAM annual convention, Gadkari had assured the auto industry that he would take up the issue of GST reduction for automobiles to 18 per cent from 28 per cent.

“I have already discussed with the Finance Minister. But ultimately if the FM has to take any decision it must be with the consultation with state finance ministers and GST Council,” Gadkari said here at the launch of a BS-VI scooter by Honda Motorcycle and Scooter India.

He further said, currently the ball was in the court of the Finance Ministry and he was confident that the ministry in consultation with state governments would take a positive decision.

Commenting on vehicle scrappage policy, Gadkari said a draft had already been prepared. “But there are still problems related with various stakeholders. We need cooperation from the manufacturers as well as the Finance Ministry,” he added.

Some of the issues are related with tax while some are related with state governments, he said.

When asked how soon such a policy could become a reality, he said, ”We are ready with the process. My ministry is trying to get it cleared as early as possible and I am confident that in the limited short time we would come to a conclusion and we will launch the policy.”

He said such a policy would also include old two-wheelers and “if the two-wheeler industry wants to suggest anything we are going to listen to it with an open mind”.

Acknowledging the current distress in the auto industry, the minister said the reasons could be myriad due to demand and supply issues, global economic slowdown or due to business cycle.

He, however, exuded confidence that within five to six years, India would become a global manufacturing hub for automobiles.

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