No easing GST rate, automakers should cut royalty payments: FinMin sources

Topics GST | Finance Ministry | Automobile

There may not be any cut in goods and services tax (GST) rates for automobiles, finance ministry sources indicated, despite demand for this by the pandemic-hit sector. Rather, the industry has been asked to reduce cuts in royalty payments to parents abroad. Indian auto companies like Maruti Suzuki, Toyota Kirloskar, and Hyundai, and auto component makers pay royalty to their parents for obtaining technical assistance/technical know-how. Sources said the rates under the new indirect tax system for the sector were lower than under the old tax regime of excise duty and value-add.....

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