GST 2.0: Odisha auto industry hopes to ride the tide

In a landmark move towards simplifying the tax structure and easing the financial burden on citizens, the Government of India announced the new generation tax reforms. Under this, the government has reduced the Goods and Service Tax (GST) rates on two and four wheelers from 28 per cent to 18 per cent. This move is expected to make automobiles more affordable for middle-class families, thereby boosting the auto sector. In conversation with OrissaPOST, eminent automobile dealers across Odisha have shared their views on the recent GST update

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The recent GST rate reduction is set to benefit primarily small and mid-segment vehicles like hatchbacks, compact SUVs, and entry-level sedans—segments where buyers are most price-sensitive.

These categories are expected to see a significant demand boost due to noticeable price drops. While the new rates apply only to vehicles invoiced after the implementation date, dealers with older stock may face margin pressure. To manage this, they often rely on OEM support or run promotions. Government clarity on input tax credits will be a key to a smooth transition. The announcement has added positive momentum to the ongoing festive season, with increased footfalls, enquiries, and a strong rise in bookings especially in the compact segment. Sales are projected to grow in double digits compared to last year. For consumers, the GST cut brings both lower prices and a more transparent tax structure, enhancing affordability and buyer confidence across the auto market.