Is it a Disappointment for Automobile Industry After Union Budget 2019 or They’re Happy Welcoming EV Support?

The industry of automobiles has respected the administration’s help for the EV (Electric Vehicle) industry in the declarations in the Union Budget 2019, yet is baffled that there has been no help for the car business when the business is confronting a few difficulties, incorporating a log jam in deals.

Society of Indian Automobile Manufacturers a.k.a. SIAM has said in an explanation that the automobile industry is glad that Finance Minister Nirmala Sitharaman has stretched out wholehearted help to EV, yet advised that this won’t help the industry in rising out of the flow stoppage.


Rajan Wadhera, the President of SIAM, quoted, “We heartily welcome the different estimates reported to advance EVs like diminishing the GST to 5 percent, except in traditions obligation on EV parts and exceptionally the Income Tax conclusion on the intrigue segment paid for loans taken for buying EVs.

All these were proposals given by SIAM, and we are thankful to the FM for having acknowledged them.

These measures will surely help in making EVs increasingly moderate and alluring to the buyers, which is in accordance with the suggestions made in the Economic Survey.”

Effects of Union Budget 2019 on Automobile Industry

Individual citizens with a yearly salary of ₹5 Lakh will get a full tax refund. There is no expansion in the essential exclusion point of confinement of ₹2.50 Lakh to ₹5 Lakh however refund under Section 87A has been expanded from ₹2,500 to ₹12,500 and would cover citizens having assessable salary up to ₹5 Lakh.


Businesses with under ₹5 Crore yearly turnover, including more than 90 percent of GST payers, will be permitted to document quarterly returns.

₹6000 per annum must be paid to each farmer having up to 2-hectare land, appropriate from September 2019.

Words by Automobile Industry

Martin Schwenk, MD, and CEO, Mercedes-Benz India

“Given the positive result of GST regarding rising income, we wish the Government would re-examine the justification of GST rates for vehicles which as of now pulls in 28% GST and 17-22% Compensation Cess.


We suggest a descending amendment of GST rate on all autos to 18% from 28% and a proportionate decrease of CESS to around 15% for all vehicles over 4 meters.

This will go about as a genuinely necessary impetus for the development of the business, particularly when it is confronting quelled client enthusiasm because of numerous components like ascent in protection costs, inflationary climbs, liquidity crunch and approaching cost increment due to BSVI execution.”

Nishant Arya, Executive Director, JBM Group

“We are envisioning the expected expenditure plan to be an idealistic one for the automobile business.


There is a great deal of difficulties that the business is at present confronting, and the push towards EV implies that much more should be done sooner rather than later.

The proposed decrease of GST on e-vehicles from 12% – 5%, and from 18% – 12% on EV chargers will give the truly necessary lift to the EV area and support electric vehicle appropriation.

In addition, the monetary allowance should likewise get motivating forces on speculation on EV innovation and endowment on CapEx for setting up EV assembling plants.


The following three years will be vital for the Indian car industry as far as interests in EV and I accept charge motivators must be reached out to makers also.”

Diego Graffi-MD and CEO Piaggio Vehicles Pvt. Ltd

“The Automobile business needs support from the Government in the current year’s association spending plan as the auto division is confronting a standout amongst its most testing periods over the most recent couple of years.

I feel GST on cars needs be decreased from 28% to increasingly objective degree of 18% as this will ingest a portion of the cost-effectiveness of things to come presentation of BS VI at and this will add to moderateness for the client and be a driving force to development.


To the extent electric vehicles are concerned we are anticipating far-reaching approach on the staged presentation of EVs in India.”

Proposals by ACMA:

ACMA – A reserve for supporting R&D and indigenous innovation advancement for a move from BS IV to BS VI, electric versatility and to meet new guidelines on wellbeing outflow and condition is exceptionally prescribed.

Such a store could likewise be used for in-house improvement or procurement and osmosis of advances through authorizing understandings, acquisitions, and so forth.


Decrease of fundamental custom obligation on Raw Material – Steel and aluminum compounds pull in essential custom obligation, i.e., 15% and 10% separately.

The division, to a great extent overwhelmed by MSMEs, is confronting a colossal test in the accessibility of crude materials at the right cost.

A decrease in traditions obligation on all amalgam steel and optional Aluminum Alloy things including scrap is emphatically prescribed.

Boosting R&D Spend – To support household R&D and testing, it is essential to give exception on import obligation on auto part models. Likewise holding of weighted expense derivation on R&D consumption is basic.


The 2016-17 Budget weighted conclusion profit by 200% to 150% and has additionally confined the reasoning to 100% from first April 2020.

Venture Allowance – Provision to reintroduce speculation stipend at 15% for assembling organizations that contribute more than ₹25 Crore in plant and hardware.

Proposals by FADA:

GST Rates on every new vehicle ought to be directed to help volumes in Automobile deals.

This will likewise help in off-setting the cost climb as the New Safety Norms and Higher Insurance Premiums are now expanding the expense of responsibility for the vehicle.


This, combined with the usage of BS-VI, will significantly further increment the prices of Passenger Vehicles, Commercial Vehicles and Two Wheelers by another 10-15%.

Alluring enough motivation for effective execution of Vehicle Scrappage Policy the nation over will have advantages of decreasing contamination, diminishing fuel utilization, improving security, and furthermore giving a lift to the Auto Sales.

What Cartechnewz Think?

In spite of the fact that no duty structures or refund pieces were examined during the spending limit, the Automobile Industry readily respected the EV Push from Finance Minister.


As the initial phase in making India drive on electric vehicles, the legislature on Tuesday, has brought down traditions obligation on import of parts and segments (10 – 15%) to advance residential collecting of electric vehicles.

The legislature is likewise focussing on the utilization of clean vitality in the transportation segment and is relied upon to before long declare a solid game plan with time-bound usage.

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