GST 2.0: People are still waiting for a reduction in GST rates. People are postponing their earlier plans to buy a car or bike. Its effect is beginning to be seen in the auto sector.

GST 2.0:  Shopping on Diwali is considered auspicious. In such a situation, if you get your favorite item at a lower rate with a discount, it will be the icing on the cake. It is expected that small cars and two-wheelers may become cheaper this festive season. The central government is planning to reduce the Goods and Services Tax (GST) on cars and bikes from 28 percent to 18 percent.

If this happens, the price of cars and bikes can fall by up to 10%. Due to this, many people have postponed their purchases and are now waiting for Diwali. Due to this, sales in the auto sector have slowed down because everyone is waiting for the decisions to be taken in the GST Council meeting on the new tax slab.

Slowdown in auto sector 

Since, people are still waiting for a reduction in GST rates. People are postponing their earlier plans to buy a car or bike. Its effect is visible on the auto sector. Meanwhile, tractor sales have fallen by up to 32 percent. Sales of two-wheelers and trucks have fallen by 6-7 percent. Sales of passenger cars have also fallen by 1 percent. Global brokerage firm Jefferies believes that if GST is reduced, then there will be an immediate jump in sales of two-wheelers and small cars. 

What are the expectations being placed? 

GST ratesGST rates On this day it will be finalized which thing will be brought under which tax slab, on which things GST will be reduced etc. However, for now it is expected that the 28 percent slab for small cars and bikes will be removed. Electric vehicles and tractors will be brought under the purview of 5 percent GST. GST on luxury cars is going to remain at 40 percent, so there is no hope of relief for premium buyers. 

How much will the savings be? 

If you have bought a car worth Rs 10 lakh and the GST on it is reduced from 28% to 18%, you will save up to Rs 1 lakh. On the other hand, if the bike is worth Rs 1 lakh, you will save up to Rs 10,000. In such a situation, the reduction in GST will definitely increase the demand, to meet which production will increase and employment opportunities will also be created for more and more people in the industry.