FADA Urges Resolution on Compensation Cess Amidst GST Reforms

The Federation of Automobile Dealers Associations (FADA) is calling for clarity on compensation cess, urging the government to ensure costs don't fall on dealers. With recent GST reforms, the auto sector anticipates growth, but dealers need clear guidance on cess adjustments for sustainable benefits.

The Federation of Automobile Dealers Associations (FADA) has called on the government to clarify the issue of compensation cess, stressing that the financial burden should not be shifted onto dealers, who are simply part of the distribution network. Speaking at FADA's 7th Auto Retail Conclave, President C S Vigneshwar emphasized the need for transparency from the government.

Vigneshwar pointed out that the industry is prepared to transfer the benefits of GST rationalization to consumers, but unresolved issues regarding compensation cess might complicate the process. He urged the government to resolve these ambiguities promptly. The cessation of compensation cess is scheduled for September 22, affecting dealers handling vehicles with varying cess percentages.

As the festive season approaches, FADA remains optimistic about market growth, bolstered by the government's GST reforms. The association has praised Union Minister Nitin Gadkari for his ongoing support, especially in promoting road safety and greener fuel options. Dealerships are bracing for a surge in demand, readying new vehicles and enticing deals for consumers.

(With inputs from agencies.)