CICU proposes reduction of GST from 28% to 18% for two Wheeler and its components

Ludhiana, January 29, 2019: Upkar Singh Ahuja, President, CICU and Pankaj Sharma, General Secretary, CICU in a joint statement mention that rooting for an urgent cut in the GST on two-wheelers from 28 per cent to 18 per cent, these vehicles provide basic mobility to the masses. CICU come against the backdrop of slowing two-wheeler sales in the domestic market after years of double digit growth. Ahead of the implementation of critical regulations like the Bharat Stage VI standards, which take effect from April 1, 2020, and the disruptions facing the auto industry. Ludhiana is home for two wheeler components manufacturing approx. 5000 units are engaged in manufacturing of two wheeler components which at present passing through crucial time. GST rate cut would provide the much-needed relief to millions of two-wheeler customers across the country and to the entire value chain dependent on the sector, they said. Two Wheeler sale is slowing down and expected a very marginal growth in year 2019. Reduction in TAX one side will help weaker section of society with better mobility. Approx 25% women use two wheeler which will help women empowerment. CICU urged the GST Council and Finance Minister Piyush Goyal that there is an urgent need to reduce the GST rate on two-wheelers from the 28 per cent bracket of ‘luxury goods’ to that of 18 per cent for mass-usage items. “Given that India has one of the highest taxation on two-wheelers (including on- road taxes) when compared to other countries, that by itself is an ample case for lowering it”. Upkar Singh Ahuja said that both safety and BS-VI regulations would cumulatively lead to a price hike of Rs 3,000 to 5000 a unit. Reduction in the GST will bring down the unit price and a cut in GST will offset the hike.