STRAIGHT DRIVE

Commercial Vehicle - - NEWS -

Ex­ceed­ing the rate of 18 per cent may lead to new chal­lenges, the im­pli­ca­tions of which will be far reach­ing.

The pas­sage of GST Bill is ex­pected to pave the way for yet an­other big eco­nomic re­form in the his­tory of In­dia. It will take some time be­fore the bill is turned into a law. An amount of de­lib­er­a­tion will be nec­es­sary to ar­rive at a con­sen­sus on rates of var­i­ous goods and ser­vices. Only then can the claim to pro­vide re­lief to com­mon cit­i­zens and small busi­ness­men re­alise. Driven by small busi­ness­men, the SME sec­tor is es­ti­mated to ac­count for 70-80 per cent of the coun­try’s trans­porta­tion needs. A panel un­der chief eco­nomic ad­viser has rec­om­mended a rev­enue-neu­tral rate of 15-15.5 per cent, with a stan­dard rate of 17-18 per cent, levied on most goods and all ser­vices. Ex­ceed­ing the rate of 18 per cent may lead to new chal­lenges, the im­pli­ca­tions of which will be far reach­ing. If the CV man­u­fac­tur­ers can look at real­is­ing their dream of stream­lin­ing op­er­a­tions and re­duc­ing op­er­a­tional costs, trans­porters can look at faster turn­around time and less taxes. In the wake of the reg­u­la­tory changes like Euro 6, and chal­lenges like ban on 10 year old diesel ve­hi­cles in the NCR re­gion, the vol­un­tary ve­hi­cle mod­erni­sa­tion pol­icy will prove to be use­ful. Its ef­fec­tive­ness will how­ever de­pend on the amount of in­cen­tive of­fered. For the chal­lenges posed, man­u­fac­tur­ers may not find it worth pur­su­ing diesel tech­nol­ogy in In­dia any­more. The costs may be sim­ply pro­hib­i­tive against the 10 year ve­hi­cle life­span.

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