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GST Rate Cut: While rationalizing GST rates, the central government is expected to reduce tax on passenger vehicles and two -wheelers. This decision of the government will make these vehicles even more cheap before Diwali. The Finance Ministry has sent a proposal of two GST rates of 5 percent and 18 percent on all goods to the GST Council, which will replace the existing four slab structure. The GST Council with the finance ministers of the states is expected to meet in September to approve the proposal.

Explain that at present, all passenger vehicles have a compensation cess of 28 percent GST as well as 1 percent to 22 percent on the basis of engine capacity, length and body type, which increases the total tax by 50 percent. Electric cars are charged 5 percent tax, with no compensation cess.

How much GST on two wheelers

GST on two -wheelers is 28 percent. There is no compensation cess on models with engine capacity up to 350 cc and 3 percent cess on models with more than 350 cc capacity. The revised GST structure is expected to eliminate tax rates of 12 percent and 28 percent, which will benefit common cars and two -wheelers. However, some harmful objects, such as luxury cars may levy 40 percent tax.

PM Modi has also announced

Prime Minister Narendra Modi has announced that citizens will get double benefit through a planned GST reform to reduce the prices of goods and services for the poor and middle classes. PM Modi said that we are bringing the next generation of GST reforms, which will be a gift for you this Diwali. There will be a huge decrease in the taxes with the common man and many facilities will increase. Our MSME, our small entrepreneurs will get a huge benefit. Everyday things will become very cheap and this will also give new pace to the economy.

Who will benefit from the cut in GST

GST cuts will benefit the initial models of passenger vehicle and two -wheelers, which are facing challenges from high acquisition costs and rising interest rates. The original equipment manufacturers (OEMs) cited regulatory changes including increased input costs and compulsory safety facilities and updated emission standards to increase the prices of initial model.

Vehicles have also demanded tax reform

Maruti Suzuki India, Hero MotoCorp And senior officials from other industrial bodies advocated tax reforms to promote sales of small cars. Many of them advocated a cut of 28 percent to 18 percent in GST to 18 percent to 18 percent to promote power, sales and manufacturing growth. GST rate In the hope of cutting, the Nifty Auto Index recorded a jump of 4.52 percent till 01:34 pm.