Why shouldn't I hire a MBA instead of you? How do I tackle this question in an interview for a HR position?

If MBA was a necessity for this Job then it would have been there in Job description and you wouldn’t have called a non MBA person for this Job Interview .

You Can answer ‘’ A degree definitely add value and new skills but it does not give guarantee about person’s capabilities ..If MBA was a necessity for this Job then it would have been there in Job description and you wouldn’t have called a non MBA person for this Job Interview ..I am not saying my skills sets are similar to an MBA person but about one think I am certain then my skill sets are in match with the job requirement and I am capable to generate same or even better results than a MBA person ‘’

Just exhibit confidence and how secure you are about yourself and your qualification and ball will be in your court..