The “grivenous mistake” of the Modi government’s imposition of a 15 per cent tax on all imports by the private sector has left Indian trucks and cargoes “out of options”, said independent truck seller and distributor Pranav Raj.
In the last few months, a raft of goods from overseas have been brought into the country, prompting concerns over what the impact of a GST on the supply chain would be.
But a new report from independent truck manufacturer, independent truck producer, independent cab manufacturer and independent cargoe maker, Indiabroad, found the tax will cost Indian truck makers and cabbies a staggering Rs 3,400 crore annually.
The report said that while the total amount of the levy will be higher than the amount imposed by the government, the cost will be borne by truck manufacturers and cab makers.
“The impact of the GST on trucks and cars will be tremendous.
The cost of the tax and the burden of compliance will be huge,” Raj said.
India’s truck sector has been going through a difficult time and a lot of its members are looking at a lot more options. “
The industry has been struggling for a long time to recover from the GST, which will make it more difficult for Indian firms to enter the global market.”
India’s truck sector has been going through a difficult time and a lot of its members are looking at a lot more options.
We have been looking at many opportunities,” he said.
The Indiaberoad report, titled India: Will this be the year of the truck, said the government should take the necessary measures to reduce the impact on the industry.”
A 15 per per cent excise tax is imposed on goods that are manufactured or imported in India and which are not imported by Indian firms.
This tax has been levied since 2014.
It has caused huge losses for the industry, especially for smaller companies.
“We believe the government must do something about the impact the 15 per percent excise tax will have on the Indian truck industry,” the report said.
It said that the government needs to introduce an excise duty on all trucks, cabs, vans, trailers and all other large-capacity trucks.
“A 15% tax will not be an easy task, as there are no alternatives to the 15% VAT on trucks.
The GST will only hurt Indian manufacturers and their employees, and it will not help Indian companies compete internationally,” the Indiabaroad report said.(PTI photo)The report added that a 15 percent tax will also impact truck owners.
“It is a very big hit for truck owners, who will lose their profits.
The burden of this tax will be shared with the tax payers, who are also the main beneficiaries of the VAT,” it said.
According to the report, the 15-percent excise tax was imposed in 2015 and the tax is expected to take effect in March 2021.
The tax has already taken a huge hit for the truck and cab industries.
The annual losses for Indian truck and cabs and for cabbie drivers have jumped by over 30 per cent in the last year alone, to Rs 11,000 crore.
“In the first quarter of 2017, the loss of revenue by truck and taxi companies stood at Rs 14,000 to Rs 16,000, which is Rs 15,000-16,000 per day,” the independent truck and driver company said in a statement.
“There is no alternative for Indian cab and truck companies.
It is imperative that the tax has to be reduced and that this is implemented immediately,” said Indiabiroad founder and CEO Rajan Gopal.
“India is a large exporter of vehicles and its industry has suffered immensely due to the imposition of the 15 percent GST on imports by foreign firms.
We hope that the GST will be implemented soon,” Gopal said.
IndiabRoad said the GST and the associated GST Duty have caused significant financial loss to Indian companies and will take time to take off.
“With a GST, there will be a rise in the price of imported goods, but the government has failed to take this into account.
The government should do the right thing, and provide incentives for Indian companies to enter global markets,” the company said.”
However, there is hope.
The government should do the right thing, and provide incentives for Indian companies to enter global markets,” the company said.