The automobile industry has a fairly crisp list of expectations from the upcoming Budget.
Firstly, reduction in excise duties or at least simplification of the taxation structure by merging certain duties, eliminating multiple levies and varying rates across vehicle categories.
Currently, total tax rate on small cars is 30 percent, on large cars is 42 percent and SUVs is 51 percent. The Goods and Services Tax (GST) rate is expected to be 18 percent for small cars and 40 percent for large cars and SUVs
Second on the wish-list is removal of national calamity contingent duty (NCCD) or its merger with excise duty, as it seems unfair that the only other industries charged with this duty are alcohol and tobacco.
Third is to provide an incentive scheme for scrapping old vehicles rather than making it mandatory and allocation of subsidies to promote electric and hybrid vehicles to curb environment hazards.
During the last Budget, the automobile industry had only been allocated Rs 75 crore as support for electric vehicles under Faster Adoption and Manufacturing of Electric Vehicles (FAME) scheme for FY'16.
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