The Indian small car segment has some news to rejoice. The Congress UPS government has given tax sops to the Indian auto industry that would make small cars cheaper in India.
The government has announced 4% reduction in excise duty which means now excise duty stands at 12% against earlier 16%. Small cars and personal vehicles are known to be one of the greatest revenue sources for the government.
The hybrid cars have also witnessed reduction in duty from 24% to 14% which is expected to benefit Toyota and Hyundai which are planning new hybrid cars in India. Currently, Indian car market does not have any hybrid cars but hybrid Scorpio was showcased this year at the Auto Expo.
Government has also given tax exemption the electric vehicles which gives them a reason to rejoice as well.
The auto component industry has also been gifted with exemption of customs duty on steel. There is now 0% duty on melting scrap steel and aluminum as well against earlier 5%.
This means that the small cars would be cheaper by Rs. 9,000-14,000. There would be greater difference for the diesel cars as well.
