Budget 2021: In latest years, the car sector witnessed a number of challenges by way of discount in demand and improve in prices because of the introduction of recent security and emission norms. In final 12 months’s price range, the calls for for the sector have been unmet. Budget 2021 is important as it will likely be introduced amid the COVID-19 pandemic when the federal government is attempting to revive the financial system. In order to offer a big enhance to the auto sector, Brickwork Ratings suggests in its report titled ‘BWR Pre-Budget Expectations FY22’, that a sign in direction of the transitory rationalisation of GST on vehicles from the present price of 28 per cent within the price range may very well be a catalyst in reviving gross sales. (Also Read: Budget 2021: GST Tax Rates Must Be Reduced To 18% To Boost Demand In Auto Sector )
The report additionally added that permitting the supply of the enter tax credit score of GST paid on vehicles for companies will improve car gross sales to corporates. Some particular deductions for curiosity paid on auto loans may be a optimistic step in boosting demand. As part of the Atmanirbhar Bharat scheme, the automotive and associated ancillary sector is included within the production-linked incentive (PLI) scheme.
According to Brickworks, the sector expects fast bulletins of particulars of the PLI scheme, adopted by the quicker disbursal of incentives. The incentives have the potential to begin vital investments in coming years. The sector additionally seeks measures to incentivise electrical car possession and selling part localisation. The authorities ought to present financing choices, cut back GST on uncooked supplies, cut back duties on lithium ion cell batteries. These measures may enhance the gross sales of electrical autos.
“We expect a GST discount in Lithium batteries from 18 per cent to 5 per cent. Also, if nationalized banks present inexpensive loans for the buy of low-speed electrical autos. These will velocity up EV adoption in India,” mentioned Nishcal Chaudhary, Founder and CEO – BattRE, a tech-driven, electrical mobility startup.