In a recent letter to the government, FADA requested that the GST on entry-level two-wheelers be reduced from 28 to 18% FADA argued that the high GST rate is making entry-level two-wheelers unaffordable for the common man. This is leading to a decline in sales of these vehicles.

FADA also pointed out that the share of two-wheelers in the total automobile sales fell from 78 per cent in 2016 to 72 per cent in FY2023. This is due to a number of factors, including the high GST rate, rising fuel prices, and the economic slowdown.

FADA believes that a reduction in the GST rate on entry-level two-wheelers will help to revive the segment and make these vehicles more affordable for the common man. This will boost demand for two-wheelers and create jobs in the automobile sector.

The government has not yet responded to FADA's request. However, the Ministry of Finance has said that it is considering the matter. The government will likely decide on this issue in the coming months.

In the meantime, FADA is continuing to lobby the government to reduce the GST rate on entry-level two-wheelers. The association believes that this is a necessary step to revive the two-wheeler segment and make these vehicles more affordable for the common man.