New Delhi sources have stated that the cheer that goods and service tax has brought to the automotive market has diminished, with concerns mounting over the risk of states raising road tax to offset revenue loss and was added that Maharashtra has already decided to increase the levy on vehicles by 2% to compensate for the absence of octroi, a state tax which has now been merged with GST.
Currently the automakers have cut prices from July 1 to pass on lower tax incidence under GST to buyers. They expected this to drive wholesale numbers in a traditionally lean July, with inventory at dealerships also running low and the increase in road tax, which is outside GST and set by states, now stands to dampen the prospects.
Sugato Sen deputy director general at industry body society of Indian Automobile Manufacturers that “industry executives had feared as much, and had demanded the central government to subsume road tax in the overarching GST framework. “In the past too, every time the central government lowered excise duty, state governments increased road tax negating the benefit. That is why we had urged the government to subsume road tax in GST”.
Maruti Suzuki Dzire market share in the entry level segment rose to 63% against 51% New Delhi sources have stated that country's largest car maker Maruti Suzuki may have a plethora of products from entry level hatchback to a crossover but only a few products have been made it to the top and stood like the pillar in the overall growth of the company.
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