Car companies seek support from Government
The formation of new and stable government at the Centre has brought a lot of hopes for the automobile industry. The industry is crying out loud to request the government to carry on reforms, bailouts and improve taxation system
THE AUTO industry is crying loud and clear, they want the new government to provide special policy to kickstart car sales.
On top of their priority is to ensure easy availability of auto loans with low interest rates. They also want the government to continue providing subsidies and stimulus packages with reduced taxes.
The managing director and CEO for Maruti Suzuki India, Shinzo, has urged the new government to continue providing sops for the auto industry. He recalled that the on December 2008, the government cut excise duty and froze petrol prices and also cut down on loan interest rates.
“I hope that the new government continues with the support and there is no excise duty hike,” said Nakanishi.
He also felt that there was an urgent need to withdraw the additional excise duty enforced in June 2008. The new excise structure had imposed an additional excuse duty of Rs 15,000 on vehicles with engines more than 1,500cc – 1999 cc and Rs 20,000 on vehicles with engines above 2,000 cc displacement.
SIAM has noted that these additional taxes affected car sales. While it discourages sales altogether, it also affected people from going for bigger cars.
Car manufacturers want the government to withdraw duties, as it was introduced in the wake of skyrocketing oil prices last year. There is also a simmering dissatisfaction among mid-size car manufactures, who feel that the government is being soft on small car manufacturers.
The mid-size car segment has been one of the worst hit during the economic slowdown. They are blaming the high tax structure for the slow sales.
The Indian rules says that compact cars with engine size less than 1,200 cc (petrol) and 1,500 cc (diesel) are heavily subsidised and attract only eight per cent as taxes. Other cars with bigger engine size attract 20 per cent as taxes. The Ford India Managing Director, Michael Boneham, said that there is a completely different system in the way automobiles are taxed in India.
Car manufacturers are demanding that the whole country be brought one tax structure, rather than divide it into multiple markets. This will help streamline the price structure for car buyer in the country.
The managing director and CEO for Maruti Suzuki India, Shinzo, has urged the new government to continue providing sops for the auto industry. He recalled that the on December 2008, the government cut excise duty and froze petrol prices and also cut down on loan interest rates.
“I hope that the new government continues with the support and there is no excise duty hike,” said Nakanishi.
He also felt that there was an urgent need to withdraw the additional excise duty enforced in June 2008. The new excise structure had imposed an additional excuse duty of Rs 15,000 on vehicles with engines more than 1,500cc – 1999 cc and Rs 20,000 on vehicles with engines above 2,000 cc displacement.
SIAM has noted that these additional taxes affected car sales. While it discourages sales altogether, it also affected people from going for bigger cars.
Car manufacturers want the government to withdraw duties, as it was introduced in the wake of skyrocketing oil prices last year. There is also a simmering dissatisfaction among mid-size car manufactures, who feel that the government is being soft on small car manufacturers.
The mid-size car segment has been one of the worst hit during the economic slowdown. They are blaming the high tax structure for the slow sales.
The Indian rules says that compact cars with engine size less than 1,200 cc (petrol) and 1,500 cc (diesel) are heavily subsidised and attract only eight per cent as taxes. Other cars with bigger engine size attract 20 per cent as taxes. The Ford India Managing Director, Michael Boneham, said that there is a completely different system in the way automobiles are taxed in India.
Car manufacturers are demanding that the whole country be brought one tax structure, rather than divide it into multiple markets. This will help streamline the price structure for car buyer in the country.
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