New Delhi, Aug. 21 -- The automobile sector is set to receive a big boost this festive season with the Group of Ministers (GoM) on GST approving the Centre's tax rationalisation proposal, according to a Moneycontrol report.

The move, aimed at simplifying the tax regime, is expected to significantly reduce vehicle prices across categories.

The current GST framework has four slabs - 5%, 12%, 18% and 28%. The GoM has backed a two-slab system that will retain only 5% and 18%, eliminating the 12% and 28% brackets.

Impact on vehicle categories

At present, all internal combustion engine (ICE) vehicles - passenger vehicles, two-wheelers, three-wheelers and commercial vehicles - fall under the 28% slab.

Electric vehicles (EVs) attract 5% GST,...