Automobile dealers' body FADA on Wednesday sought GST reduction on entry-level two-wheelers to 18 per cent from 28 per cent currently.

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A delegation of the Federation of Automobile Dealers Associations (FADA) submitted a letter to Minister of Road Transport and Highways (MoRTH) Nitin Gadkari in this regard.

FADA has requested for GST rate cut on entry-level two-wheelers, predominantly within the 100-125 cc segment.

"With two-wheelers accounting for over 75 per cent of the volume and over 70 per cent of this stemming from the entry-level category, it's imperative to address the over 20 per cent decline we've observed since pre-Covid times," FADA President Manish Raj Singhania said.

To propel India towards becoming a USD 47 trillion economy by 2047, every segment of the domestic automobile industry must function at its zenith, he added.

"Reducing the GST from 28 per cent to 18 per cent for entry-level two-wheelers is more than just an economic strategy; it's about empowering the common man and boosting rural mobility," Singhania stated.

While several categories within the auto sector have displayed commendable recovery post the Covid-19 pandemic, the entry-level two-wheeler sector remains notably affected, he added.

"FADA believes that a GST revision would significantly alleviate the burden on potential buyers, especially in rural India, and catalyse the resurgence of this vital industry segment," Singhania said.

FADA represents over 15,000 automobile dealers having 26,500 dealerships across the country.