GST Impact on existing car lease
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Dear Shri. Arun Jaitley, GST Council Members,
We represent the working class who pay our taxes on regular basis, File returns regularly and a strong believer and supporter the digital transformation that we have embarked upon. We have been looking at GST with lot of hope and we sincerely believe this would be a great enabler for simplifying our tax regimes.
I would like to draw your attention to the GST implications on the tax I am sure you are aware about a peculiar situation that is being faced by the employees of organisation where we have opted for car lease prior to July 1.
As you are aware Goods and Services Tax (GST) is an indirect tax throughout India to replace taxes levied by the Central and also the State governments. GST rollout is effective from 1st July 2017. The new tax rate under GST will have negative impact on existing car Lease transactions.
You may be aware of the fact that these people have already paid the excise duty and there is no way they could claim back the amount in the GST model. So the existing GST taxation would result in additional burden on the existing leasing. The existing leasing are with a tax rate of 13.5% or 14.5% and with GST in place, this would become 29% to 43%.
The result would be additional burden of close to 30% to the existing car lease users and this would be break all of us without doing any mistake of ours. I would sincerely request you to please consider removing the double taxation on the existing leasing.
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