The auto industry leaders have again requested the government to reduce the GST liabilities for the industry because of the reduction in sales due to the outbreak of coronavirus. The requests were made during a video conference on Thursday with Union Minister for Heavy Industries and Public Enterprises Prakash Javadekar in which the steps to minimize the impact of coronavirus were discussed. The main focus of the webinar was to get suggestions on ways to start the production again but the producers couldn’t resist themselves from asking for the help of the government.
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The manufacturers and suppliers in the auto industry have been asking for a reduction in GST since the sale slump of 2018. Some additional demands were also made that included demand boosters, employment support, financial assistance, and various other demands. They also demanded permission for the sale of vehicles to be facilitated online if the lockdown continues. The sale of vehicles was at the lowest in March 2020 being half and the status for April is a complete washout because of the lockdown.
“The auto sector is a mass employer and contributes the maximum GST amongst all sectors…Last year, the industry suffered because of a planned migration from BS-IV to BS-VI compliant vehicles. This was one change which made the customers postpone their purchases,” remarked the minister after the meeting. He had assured the industrialists that he will be communicating with the respective ministries about the matter raised.
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The slowdown in the economy has resulted in a reduction in sales in the previous 2 yrs. The shift of the industry to BS-VI compliant vehicles has reduced the sale even further. A lot of manufacturers are facing financial and cash flow issues because of it. Maruti Suzuki’s R.C.Bhargava, Hero’s Pawan Munjal, Mahindra’s Pawan Goenka, Auto industry body SIAM’s president Rajan Wadhera, component manufacturer’s body ACMA’s head Deepak Jain and CII president Vikram Kirloskar were among the other industry leaders that attended the webinar.
