India is among the world's largest two-wheeler markets and for a good reason. Millions of people in the country are dependent on a two-wheeler for their daily commute. It may be a common man's mode of commute, the government still levies a GST (Goods and Services tax) of 28 per cent. Rajiv Bajaj, the managing director of homegrown Bajaj Auto says that's just too much.
On Friday, the company launched Freedom 125, the world's first motorcycle that runs on CNG, and it's priced attractively between Rs 95,000-110,000 ex-showroom. On a full tank (2 litres petrol and 2kg CNG) the company claims a mileage of up to 330 km and says running costs can reduce by half.
CNG may be an eco-friendly fuel compared to petrol and cost effective, too, but this bike will still attract a GST of 28 per cent.
Electric Vehicles are levied a 5 per cent GST. With Union Minister Nitin Gadkari in attendance, Bajaj reiterated the need to lower the GST for vehicles on cleaner fuels, too.
"The government should seriously review GST rates for clean fuels, just as they have done the right thing with the 5 per cent GST for electric," he said.
Bajaj pointed that in major two-wheeler markets in Latin America and ASEAN the equivalent of GST was 8-14 per cent and almost without exception, the GDP per capita was equal to or higher in these countries than in India.
"So, the aam aadmi (common man) of India is the one who can afford the least out of Thailand, Malaysia, Indonesia, Brazil etc. Then what is the logic, justification of 28 per cent GST," he asked.
Bajaj said, the company had done its bit, pricing the Freedom below Rs 1 lakh, and felt the government should also now do its bit with lower GST.
