Royal Enfield chairman calls for 18% GST on all two-wheelers
What's the story
Siddhartha Lal, the Executive Chairman of Eicher Motors and parent company of Royal Enfield, has called on the Indian government to impose a uniform 18% Goods and Services Tax (GST) on all two-wheelers. He warned that a split tax regime could jeopardize India's global leadership in this sector. The plea was made in a post on X, where he used the hashtag #TwoWheelsOneGST to emphasize his point.
Industry impact
A look at Lal's plea
Lal emphasized that the Indian two-wheeler industry is a major success story of the Make in India initiative. He said it is also the only manufacturing sector where Indian brands are globally dominant. He noted that with government support and a strong domestic base, Indian firms have achieved unmatched scale, quality, and cost efficiency. This has even attracted foreign manufacturers to set up operations in India.
Market dominance
Indian brands dominate small-capacity motorcycle segment
Lal pointed out that Indian brands already dominate the small-capacity motorcycle segment globally. He said they are now making significant inroads into the mid-capacity segment through heavy investments. "By delivering exceptional value, we are drawing riders worldwide to shift from larger, higher-displacement machines to Indian-made mid-size motorcycles," Lal said. To sustain this momentum, he stressed a uniform GST of 18% across all two-wheelers is critical.
Tax implications
Differential tax structure would hurt investment
Lal warned that a differential tax structure would hurt investment, limit global reach, and give foreign competitors an edge. He said motorbikes above 350cc account for just 1% of India's two-wheeler market. "For Indian riders, these motorcycles are not luxury goods; they are efficient, affordable alternatives to cars," Lal added.