Taxes add 50-70% to price of cars in India
Purchasing a car in India could be ‘injurious to the pocket’. Reason being- cars are taxed more than cigarettes in India, says Mr Jnaneshwar Sen, Senior VP, Honda Cars India. Taking into account taxes such as excise duty, CST, calamity tax, education tax, VAT and road tax among a host of others, car prices increases by 50-70% due to these taxes.
While VAT is charged at the rate of 12.5% in some states, there are other states where buyers have to shell out 14.5% VAT and while road tax may stand at 4% in some states, 16% is charged in other states. The discrepancy in subsidy of diesel is another factor buyers have to contend with when opting for diesel powered vehicles.
All these factors have a direct bearing on the auto industry while the continuous fluctuation on prices of petrol and diesel also has a direct impact. Despite the fact that Centre Govt. recently introduced excise duty cuts, no immediate growth was noted by automakers and customers are still putting off purchases of new car in view of a more secure government which could bring with it stability in policies.
via Economic Times
Email - [email protected]