Here's a very good news in the pocket of GST for the auto sector. In order to rule out any discrepancy out of the GST implementation route, the govt. has decided not to put any cess on the products and services mentioned in the last three general union budgets. With the Taxation Laws Amendment Act 2017, The Industries (Development and Regulation) Act 1951, the central govt will take away the automobile cesses.
Just like there is no education tax or taxation on goods with less than Rs. 20 is not applicable, there would be no tax on automobiles that are originally produced or assembled in our own country. By doing so, the govt. would be able to demarcate all the goods and services in their respective slots of one general tax. Now, the govt. is withdrawing any taxation from the fields of cement, strawboard, Iron Ore Mines, Manganese Ore Mines and Chrome Ore Mines by amending Labour Welfare Cess Act, 1976, Tobacco cess by amending the Tobacco Cess Act 1975, and Cine Workers Welfare Cess by amending the Cine Workers’ Welfare Cess Act 1981.
All these industries indirectly affect the functioning of the automobile industry and removal of taxes shall benefit the industry and its demand and supply as well. The directly associated industry with it, ie, the rubber industry has also lost its taxation for good under the Rubber Act, 1947. The overall tax saving and coming of GST will benefit all the sectors, and the economic growth is expected to explode in the next 5 years. The incomes are expected to go higher, with new job opportunities pouring in the country and the increase in its cost-effective 'Make In India' project in proliferation.
