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Failure to cut GST now will be counter-productive for the two-wheeler industry: Honda

The industry was hoping the GST Council’s August 27 meeting would announce a cut after Finance Minister Nirmala Sitharaman’s statement on August 25 that such a move was merited. However, the Council did not lower the rate and two-wheeler makers now fear buyers may postpone purchases till a GST cut is announced

September 01, 2020 / 09:58 AM IST

Honda Motorcycle and Scooter India (HMSI) fears that the momentum gained by the two-wheeler market at the end of June could be derailed if there is any delay in cutting Goods and Services Tax (GST) rates.

“It was definitely appreciated when the Finance Minister recognised that the two-wheeler (industry) merits a reconsideration of GST to a lower bracket. However, the intention will get credibility only with quick action, otherwise it may be counter-productive for the industry,” said YS Guleria, Director, Sales and Marketing, HMSI, in a chat with Moneycontrol.

The two-wheeler industry was pinning its hopes on the August 27 GST Council meeting, hoping for a decision on lowering GST on two-wheelers following Finance Minister Nirmala Sitharaman’s statement on August 25 that such a move was merited.

Speaking during a webinar organised by the Confederation of Indian Industry (CII), the Finance Minister had said: “Two-wheelers are neither a luxury nor a sin good and hence merit a rate revision.”