New Delhi, Nov 8 (KNN) The Micro, Small and Medium Enterprises (MSMEs) involved in manufacturing auto and cycle parts have been suffering due to the newly implemented Goods and Services tax (GST) in the country, United Cycles and Parts Manufacturers Association (UCPMA) informed.

Rajeev Jain, General Secretary, United Cycles and Parts Manufacturers Association told KNN that the main drawback of GST is that it’s not uniform, the raw materials used in auto parts manufacturing like nuts bolts, pumps, dynamos have different gst rates and for some raw materials there is no defined GST rate.

The sector have been demanding government to consider their demands seriously. Many workers in the auto parts manufacturing units have lost their jobs and some small scale units are on the verge of shutting down.

He added that the big companies have starting forming cartel which had reduced the business of MSMEs. The prices have been increased manifold which has nullified the effect of GST which was supposed to decreased the prices.

The prices of raw materials have been increased and trade volume have gone down and the MSMEs are facing the shortage of working capital because demand has been decreased and companies don’t have orders anymore.

With regard to the GST filing system, he informed that it is very complex which is hampering the growth of MSMEs in the auto parts manufacturing sector and the small scale companies haven’t received the refund yet which has blocked their businesses.

He further said that the GST exemption to companies having turnover upto 20 lakh turnover is useless as nobody is ready to do business with them and ultimately they have to GST themselves registered for GST.

Jain suggested the government should simplify the process of GST filling, should make 2 GST slabs instead of 4, abolish RCM (Reverse Charge Mechanism) and should work on improving ease of doing business and  consider the demands of auto parts manufacturers seriously. (KNN/AG)