This year’s budget has become very important due to the corona virus epidemic. There are many sectors of the economy that have not yet recovered from the loss of lockdown. The auto industry is also one such area. According to the Federation of Automobile Dealers Association (FADA), vehicle registration growth in December 2020 is good at 11 percent but there is no guarantee of how long it will last. Amidst all these problems, the automobile sector has many expectations from Finance Minister Nirmala Sitharaman from the upcoming Budget 2021.
Vehicle registration has come up
Despite the boom in vehicle registration, the employees of this sector want income tax, expendable income, GST tax cut on vehicles and increase in rural expenditure. Spending on infrastructure in rural areas increased the need for trucks. According to Fada, growth in registration in December registered a growth of 24 percent. Factors such as good harvest, new launches, year-end offers and purchase before the price increases this year.
Vehicle scouring policy can be mentioned in the budget
Despite the government running all kinds of incentive schemes under a self-sufficient India, demand for cars continues to decrease. 57 thousand crore was given to the auto sector in this scheme. The plan will have long-term benefits but car companies are still waiting for customers to return to the showroom. In this episode, manufacturers also want to cut GST. Significantly, the much-awaited vehicle scrappage policy, which aims to boost automobile demand by phasing out old, polluting vehicles, can find mention in the Union Budget 2021-22. The vehicle scouring policy has stuck at various levels over the years. The policy will benefit automobile manufacturers. The official, requesting anonymity, said that the final decision would be taken by the Prime Minister’s Office and the Ministry of Finance.
Budget 2021: Finance Minister Nirmala Sitharaman may announce vehicle policy for old and polluting vehicles
Electric car industry will be encouraged
For the protection of domestic manufacturers of electric cars, the Finance Minister had increased the custom duty on electronic vehicles from 5 percent to 15 percent in the last budget. By giving necessary incentives to the auto sector in the coming budget 2021, this sector will be able to come out easily due to the epidemic.