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Automobile Retail Industry Seeks Recognition as MSMEs


In the budget recommendations made to the government by the
Federation of Automobile Dealers’ Association (FADA)India’s automobile retail industry has sought recognition as micro, small and medium enterprises (MSMEs).
In the recommendation made, the Federation suggests that dealers, workshops and service stations must be covered under the ambit of MSMED Act 2006, as the subsidies and incentives received under this act will provide much-needed relief to them.
The federation is of the belief that the move will help the sector which provides 25 lakh direct jobs to get access to loans at lower interest rates and also reduce the tax burden.
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“Our main request, amongst others, is to be considered under MSME on an immediate basis and consider industry status in the near or mid-term to our sector. Today only the auto workshops have been kept out of the MSME category, despite qualifying and following all regulations required as an MSME under all parameters,” FADA President Ashish Harsharaj Kale said.
“The auto retail sector, despite its huge contributions does not avail of any incentive or support under any category currently.”
The federation also demands a reduction in the GST rates to five percent on margins of all pre-owned vehicles. Along with this, it requests the government to reduce the cess charged on the automobiles as the country’s automobile sector faced severe stress
“We believe by doing so it will create a positive consumer sentiment and better affordability in automobiles, which have seen unprecedented price hikes currently and will do so in the future too, due to stricter, but much required regulatory norms,” Kale said.

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