As per the reports issued by parliament, the Indian government is poised to start examining the new proposals regarding the hike in excise duty rates for diesel models. The news has influenced the prices of imported diesel vehicles in India, particularly heavy duty diesel models and several imported Sports Utility Vehicles (SUVs).
Reportedly, in a written answer to a question raised in Rajya Sabha regarding the Government's stance on the proposed hike in excise duty for diesel cars, Minister of State Finance, S S Palanimanickam commented, “Representations have been received by the government for increasing excise duty on diesel cars. These are under examination.” He further added, “The requests have been justified on the ground that diesel cars are more polluting and consume subsidised diesel providing unintended benefit to diesel car users.”
Referring Society of Indian Automobile Manufacturers (SIAM), the minister also informed about the composite sales figures of petrol and diesel cars, sold in domestic region in 2009-2010, 2010-2011 and 2011-2012, which were standing at 15.28 lacs, 19.73 lacs and 20.16 lacs, respectively.
Reportedly, the Government is working in light of sharp surge witnessed in the demand for imported diesel vehicles by increasing the excise duty rates. Efforts are being made to find alternative measures to curtail the asymmetry in sales of petrol and diesel vehicles, which is presently not balanced in the country. The decision may not come as a surprise to the diesel car makers as they have been expecting a higher tax to be levied on diesel cars since last year.
