Budget 2017 wishlist: Expectations from the automobile sector

Industry Size: All categories: 23.9 mn units (including two-wheelers, passenger vehicles, Commercial vehicles, three-wheelers) (according to Siam)

Employment figure: Industry is providing direct and indirect employment to 29 mn people (according to Siam)

Contribution to GDP: 7.1% to GDP (Siam)

Key issues of concern India Budget News for the automobile sector

Taxes: Industry is subject to a multiple taxes. These have a cascading effect and end up constituting a substantial part of the overall cost structure of a vehicle

Demand fluctuations: On account of various macro-economic factors, the industry has seen fluctuating demand in the domestic market. This has impacted the industry growth in the short term

Industry Demands

Introduce incentives for scrappage of old cars

The proposed GST legislation, from July 1, is expected to rationalise and simplify the tax structure for the automobile industry, inter alia, by subsuming multiple levies and rationalising tax rates. The tax structure proposed in the Budget should ideally be a precursor to the forthcoming GST tax structure, enabling the industry with adequate time to prepare itself

A Budget which focuses on boosting rural consumption, demand and lower interest rates, would augur well

Budget 2017 wishlist: Expectations from the automobile sector

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