Important things to know about Automobile Industry
Car is something that raises the status symbol in a person’s life. If, for a common man, the 3 necessities are food, raiment & shelter, then for a rich man, those 3 necessities are a palatial house, a substantial bank balance and a chic motorcar.
Now, if you are eager to buy yourself a vehicle, the most important thing is the cost consideration. Sometimes, people go on as per their budget estimates but land up facing huge costs. Just ever thought, why does this happen? It’s just because there is a calculation of GST on Automobiles that you are missing out. The GST or Goods and Services Tax system has to be sure understood as per its degree of potential in every one of the divisions of the economy. The standards of GST registration and GST rates are right now judicially connected to practically all goods and services. These rates have been genuinely connected for every one of the businesses according to the idea of the provisions.
One such important occurrence is the vehicle business. Eminently, India today stands at the fourth position among the biggest makers of engine vehicles on the globe. Also, over 210 million individuals in India possess self driven vehicles. In this way, it must be realized what are the arrangements of GST law for the motorcar business.
- What are the tax slab rates of GST on all Motor Vehicles?
The GST arrangements are plainly characterized on account of engine vehicles. GST rates relevant to vehicles are separately:
- 18%, and
- Which vehicles are put in the most elevated GST rate?
The most elevated GST pace of 28% applies to dealers having GST registration and dealing in-
- All petroleum and diesel autos, including:
- Little vehicle, coupe cars, station wagons and vans, jeeps, etc.
- Sports auto cars,
- Extravagance automobiles and SUVs
- Overwhelming business vehicles like limousines.
- What is the most elevated complete GST tax rate for vehicles?
Here, it’s critical to take note of that for all autos, where the GST @ 28% isn’t the main guideline tax relevant here. In this classification, you must a pay additional cess of 22%, which is likewise imposed to such vehicles, in spite of the high 28% GST rate. Consequently, the general tax rate on extravagance and overwhelming vehicles turns out to be as high as 50 percent.
The input credit can be availed by the car seller having GST registration.
- Which vehicles are put in the GST pace of 5%?
The most minimal GST rate on vehicles of 5% appropriate to:-
- Carriages for use by in an unexpected accident prone individuals, both mechanized and non-mechanized, and their extra parts and extras.
- Every single electric vehicle
- Here, the information tax credit can be availed by the vehicle seller having GST registration.
- These new GST paces of 5% for all dealers having GST registration were presented in the 31st GST Council Meeting.
- Which vehicles are GST absolved?
Every single electric buss with a seating limit of 12 travelers or above, kept running by nearby transport specialists will be excluded from GST. And for this situation, no ITC can be availed by the car vendor who is having GST registration.
- Which vehicles are set in the GST pace of 12%?
Following are where GST @ 12% is relevant:
- Electric Vehicles, both 2 and 3 wheelers.
- Cross breed Vehicles, which are driven by energy units utilizing hydrogen power device innovation.
- Bikes and non-mechanized rickshaws and their extra parts and frill
- Hand driven vehicles, for example, rickshaws and hand trucks
- Beast run pull-carts (for example bullock cart, tonga, chariots)
- Which vehicles are all set in the GST slabof 18%?
Following are where GST @ 18% is pertinent:
- Vehicles for in specially abled individuals, subject to the condition that adjustment must be done to make them usable for such people. For example a bike with supporters.
- Child carriages, pram carts, and its genuine extra parts.
- Play carts, tricycles, hover boards etc.
Along these lines, these are GST rates appropriate to different sorts of automobile dealers having GST registration.
- When can a car dealer take GST Composition Scheme?
GST registration under the Composition Scheme is only for those small taxpayers, on which government had decided to trim down the GST tax compliance burden. Old used car dealers or small dealers need not have to file monthly GST return. Plus, they need to pay a small GST on a fixed rate of annual turnover. Any business that has an annual turnover up to INR 1.5 Crore can get GST registration under composition scheme.