Remove 3% additional excise on SUVs: Praful Patel to FM

In the Union Budget 2012 Finance Minister P Chidambaram announced an additional excise duty of 3 percent on special utility vehicles (SUVs). Heavy Industries minister Praful Patel has now rushed to the rescue of SUV-makers and has asked the FM to do away with the additional duty, reports CNBC-TV18’s Anshu Sharma.

Also Read: 3% SUV tax is fair amount of burden, says M&M CFO

In his letter Patel said that since diesel prices are being progressively increased to align with the market prices, it would be unfair to have 3 percent additional excise duty on these SUVs.

Most of these vehicles run on diesel and a lot of them run in the rural areas like Mahindra and Mahindra's Bolero, Tata Motors’ Sumo, General Motors’ (GMs) Tavera and others.

The solution that he has proposed is that these duties should be exempted for the cars, which are priced below Rs 10 lakh for this year and if the FM could do away with this 3 percent additional excise duty from the next year onward.