The Finance Minister Mr. Arun Jaitley has announced the much-anticipated first full budget of the Modi Government on the Budget Day. Automobile Industry was expecting a lot from the Finance Minister, but some are fulfilled, some are not. The demands of Indian Automakers were:
- Implementation of GST ( Goods and Service Tax)
- Slashing Interest Rates on Vehicles
- Additional Excise Duty on vehicles
The trimmed Corporate Tax and Investments in Infrastructure will help the Indian Auto Industry. The demand of Lower Excise Duty has not been addressed in the Union Budget 2015, it means there will not be any reduction in the prices of Cars and Two-wheelers. They will not be available at cheaper prices in the market.
The previous UPA Government had slashed excise duty on cars. It was cut to 24% from 30% in the case of SUVs, 20% for mid-sized cars and 24% for large cars. The Modi Government has not reduced Excise Duty in this Budget, but GST will be implemented from April 1, 2016.
The Auto Industry had been demanding the implementation of GST since a long time. The implementation of GST will create a uniform tax structure across all states in India.
There was no announcement regarding lowering the Interest Rates on vehicles. The Government is taking initiative to promote green vehicles in India. The Finance Ministry has proposed 75 crore rupees for Electric Vehicles and Excise Duty Concession will remain same for Electric Vehicles.