Boost Demand through favorable taxation

China's monthly 4 Wheeler Auto sales are 2.5 million units i.e. 25 Lakhs
In India a 25k booking for Hector, 45k for Hyundai Venue etc that also for delivery over 6-12 mths creates excitement

In China , They are trying to revive the market via VAT cuts, lower rates.

What can India do to boost demand. Why do we need 28% gst on automobiles?? more  

View all 6 comments Below 6 comments
It is bound to happen with imminent change in technology - Now electric cars are the future more  
The compounding challenges specifically being faced by India vis-a-vis increase in 4 wheelers and 2 wheelers:

1. Pollution

2. Total dependence on external countries for import of fuel (crude oil) thereby losing valuable foreign exchange and also making us a perfect loser on negotiating table in case of a national emergency.

3. Crumbling infrastructure: We are a country with limited land area and are the second largest in terms of population in the world (no where near China in terms of population density and land area available). The space required to park and drive the cars is already a acute problem in all the cities. How are we going to accommodate the additional vehicles?
Are we perpetually going to build and rebuild the same roads every year and have a negative budget every year. this we will never have finance available to increase the quality of education, research institutions / activities / healthcare etc.

4. Law and Order: Every day in every city there is minimum one incident of road rage / accident because of overloaded road infrastructure and thin patience of people stuck for hours in traffic jams. Every new vehicle added adds to this chaos.

5. Criminal Waste of Limited Resources: In India the vehicles are personal property and is treated as a sign of his status in society. People are reluctant to share the vehicle rides (Car Pooling). So most often we see a 5 seater / 8 Seater car having only one occupant and after reaching the office or home the car is lying unutilised for the remainder of the day, occupying precious limited space available in the country. total waste of an expensive resource. In families with surplus finance we see each and every household member having his own personal vehicle. Isn't this a criminal waste of limited resources and infrastructure.

The need of the hour instead is to create the best public transport facilities to cater every section of the society and class, so the social stigma's and class ego's can be met. A seamless combination of Metro / BRTS / Buses / Shared Taxis can be developed so that we as a nation can proper and be counted in developed nations.
It is not only the responsibility of the government but the corporates can also contribute by withdrawing all the parking facilities / office cars provided to individual employees. Instead they should be made to share a company bus / shared car / radio taxis. The same vehicles can be used throughout the day for various other activities.

GST on all sort of vehicles for personal use should be increased including EV's because whatever the sort of fuel (electric / fossil), we still will face the same challenges. more  
Situation in country is that there is no space to park the cars on roads & every now and then there are quarells between neighbours over parking. Pollution is another problem which is deteriorating the health of individuals due to to excess of vehicles on roads. GST is levied on cars is correct and rate of finance should be increased to discourage the more purchase of cars. Economy of country can be increased by reducing the GST on other items like washing machine, fridge, TV and AC. more  
Before increasing any thing deep study is required as such we are having Pollution problems in Urban areas more  
Point is, do we require so many four and two wheelers in the country adding to pollution? A 28% GST is quite appropriate. My instinct will be for a 50% GST. Instead, we should demand for more public transport like metro, buses, local trains and affordable ap based taxis. more  
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