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Cigarettes Taxed Lesser Than Cars In India
In India, it is expensive to buy a vehicle owing to the taxes that are levied on the vehicle. Especially the imported vehicles attract a special import taxes and many more too. The taxes that are taken from us are for calamity tax, education tax, road tax, excise duty, VAT and CST.
The tax laws in India are not uniform and differ from state to state. It was noticed that the taxes on injurious products like cigarettes are lower than what it should it be. The cars in India attract taxes in the range of 50 to 70%.
Mr Jnaneshwar Sen, Senior VP, Honda Cars India, explained if a vehicle costs Rs 100, once the car rolls out the manufacturing plant the vehicle will cost roughly Rs 50 to Rs 70 more. Aside from this there is also transport costs and dealer profits.
In India, Value Added Tax is charged at 12.5% in most states however, it is not uniform certain states in India demand 14.5% VAT from customers. There is also a special road tax that levied on owners of vehicles. This tax is charged at 4% in certain states, while in other states this same tax is charged at 16%. This is a huge difference between the two and the customer is the one who suffers the most in the end.
Certain auto experts believe that these irregularities in taxes are directly affecting the auto industry. Even the price difference between petrol and diesel is a major contributor for the auto industry being in a state of panic.
The Government had recently introduced excise duty cuts however, the auto industry did not report significant changes in the buying trend. Potential customers still stayed away from buying a new vehicle.
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