New Delhi: Industry body Society of Indian Automobile Manufacturers (SIAM) on Saturday said the auto industry would have to "find its own balance" to boost demand, with the GST Council declining to cut rates for the sector.
"The auto industry was very hopeful of GST reduction. It is clear that there is no reduction of GST rate on vehicles from 28 per cent to 18 per cent," Society of Indian Automobile Manufacturers (SIAM) President Rajan Wadhera said in a statement.
The industry has to find its own balance to enhance demand, he added.
The GST Council, which met in Goa on Friday, did not cut tax rates on automobiles. The industry had been demanding a GST rate cut from the current 28 per cent to 18 per cent in order to revive sales which have been facing a prolonged slowdown.
The auto components industry too had demanded a uniform GST of 18 per cent. At present, 60 per cent of auto components are taxed at 18 per cent, while the rest are in the 28 per cent slab.
Wadhera expressed hope that the festive season would help in ushering in positive consumer sentiments.
He said the reduction of GST compensation cess for the sub-segment of 10-13 seaters with length less than 4 metres is positive step as the industry had been demanding it for a long time.
"SIAM had requested for abolishing compensation cess for the whole segment of 10-13 seaters vehicles, however, the benefit has been partially met," Wadhera said.
He also expressed hope that the recent measures taken by the finance minister will support growth and once the market stabilises and revenue rises to comfortable levels, the government would be able to rationalise GST levels and reduce rates on vehicles.
The all-powerful GST Council on Friday announced a slew of measures, including slashing the tax rate on hotel room tariffs and more than doubling the tax on caffeinated beverages to 40 per cent.