Union Budget 2015 extends concessional customs and excise duties on select parts for electric and hybrid vehicle manufacturing for a year. SIAM acknowledges Finance Minister for having accorded approval to Faster Adoption of Electric and Electric Mobility (FAME) scheme. Though initial allocation of Rs 75 crores is modest, industry is hopeful that additional resources would be allocated to promote green technology in quick time.
Green vehicles is crucial for the automotive industry. SIAM had requested customs duty rise from 10 – 40 pct on commercial vehicles. Rates have been increased to 20 pct. Excise duty reduction on ambulance chassis from 24 – 12.5 pct is announced.
Reforms are intended to improve consumer sentiment and disposal incomes that benefits the Indian automobile industry. Date of implementation of GST from April 2016 helps manufacturers develop clearer long term plans in regards to product and investment. Corporate tax reduction from 30 – 25 pct over the next 4 years affords a clear roadmap to do away with industry uncertainties.
Union Budget 2015 focus on infrastructure development will boost multiple industry prospects, including automobiles, in particular commercial vehicles industry. Rural development focuses substantial allocation under MNREGA ensures improved demand from non-urban centres, and will benefit the auto industry.
In forthcoming budgets, Kirloskar expects emphasis on renewal of vehicle fleet through fiscal incentives. Fleet renewal would help both the industry and society in terms of the environment, health, etc. SIAM was keen on moderation or excise duty reduction on vehicles. Particularly large vehicles that attract 30 pct excise duty. Thsi has been ommited in entirety. SIAM hopes Finance Minister reconsiders high taxation on cars. Overall Union Budget 2015 provides more purchasing power to consumers through varied development schemes to boost overall market scenario and consumer demand. Systemic changes are proposed to bring about reform and development.