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Old 17th June 2012, 10:34   #376
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Default Re: Govt plans to impose additional levies on diesel cars

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Originally Posted by pypkmsrikanth View Post
The question is should the first buyer alone pay the additional levy when in most of the cases the cars are sold off at about 5 years for a new car.
It should not be the first buyer alone. Tax should be for the year on year usage and not for "purchasing". "Fuel Tax" should be like "Water tax" or should be off set with Congestion, Pollution tax etc.

I think taxing the first buyer is not going to help. To improve on margins due to reduced diesel car sales car manufacturers might in turn increase petrol car prices. As customers would have no choice to but to buy a car anyway if they want to.
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Old 17th June 2012, 11:05   #377
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Default Re: Govt plans to impose additional levies on diesel cars

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Else does it mean that they are going accept failure?
You gotta be kidding me . It is the fault of the Greeks, the Martians and of course all those greedy diesel car owners who are solely responsible for the decimation of the country.

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Originally Posted by vb-san View Post
Have a look at this article Diesel exhaust fumes more harmful - News - Autocar India.

Instead of talking on adding up the cost, I hope the authorities look into bringing in better emission norms, and its strict enforcement.
+1 to that. But why limit it to the cars. How about the mass transport vehicles? Not only there is mass flouting of anti-pollution norms by these vehicles and most of them plying on the roads are past their expiry date. These vehicles are not replaced due to populist policies until they have rusted to dust. While they are still running they are overloaded to the brink causing further pollution. IMO there is an immediate need of a massive revolution in our surface transport policy, something like the new deal, ignoring all populist approaches and vested interests. On the other hand improving the efficiency of these public transportation vehicles would automatically help achieve consumption of lesser fuel which then brings much better reduction in inflation numbers.

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Originally Posted by pypkmsrikanth View Post
In my opinion the automakers are up in arms against the Additional Tax for Diesel cars primarily because they would not be able to charge the high premiums any more because the difference between Petrol & Diesel cars would be too large to eat into Petrol Car Sales.
They would be forced to pass the additional charges to the customer. It will obviously will hit car sales all over with petrol going to stay above 70 on an average for a long time to come. I guess this is the auto boom in India petering out slowly now.

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Originally Posted by pypkmsrikanth View Post
Correct me if I am wrong, the difference between Petrol & Diesel cars contain a high artificial premium charged by the auto makers taking advantage of the Diesel Pricing Policy.
Not a fat lot. It does take more money to build a diesel car with the heavier engine, insulation, damping, accommodation for more wear and tear. But yes there is obviously higher profit margin when compared to a petrol car. If that vanishes I wonder if they would even stay profitable given petrol car sales falling precipitously. They might as well shut shop and flee.

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Originally Posted by pypkmsrikanth View Post
Car users take their share of premium in diesel vehicles when they resale their cars.
Given the situation in the country now, I don't think car owners are going to sell their diesel vehicles any time soon.

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Originally Posted by pypkmsrikanth View Post
If so why should the government not levy the additional taxes to offset the subsidy in Diesel. On an average Diesel subsidy is roughly around Rs.5/- per litre at the minimum, at about Rs.1,50,000/- it works out to about 150 litres a month for a 15 year lifespan of a Diesel car. The question is should the first buyer alone pay the additional levy when in most of the cases the cars are sold off at about 5 years for a new car.
Not really. The subsidy claimed by the government is about Rs 14 and not Rs 5 per liter. Actually if diesel was sold without taxes at market rates with dealer commission and transportation charges it would sell for around Rs 46/47. What happens is individual states charge varying degree of taxes aside from the central VAT (state taxes are way higher compared to the central VAT amount) which needs to be reimbursed by the oil companies. Hence the oil companies arrive at a weighted average amount of Rs 14 for the taxes to be paid to all the states and central VAT on diesel and sell it to the dealers for Rs 33. The rest is history. I have pointed out earlier that this diesel subsidy concept is nothing but an immaculate money transfer from the central coffers to the states. To your point of letting the diesel users pay this additional amount, do you think given the no. of private cars sold, it can bridge that deficit so much to make the S&P suddenly jump up with joy and move India's ratings upwards?

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Originally Posted by LandCruiser View Post
It should not be the first buyer alone. Tax should be for the year on year usage and not for "purchasing". "Fuel Tax" should be like "Water tax" or should be off set with Congestion, Pollution tax etc.

I think taxing the first buyer is not going to help. To improve on margins due to reduced diesel car sales car manufacturers might in turn increase petrol car prices. As customers would have no choice to but to buy a car anyway if they want to.
Including the thousands of cab owners, mass transport companies, politicians in their SUVs? If a fat lot of that happened, Katrina Kaif is madly in love with me. Why is it that for every deficit to be bridged it is the middle class only who must pay up through additional taxes? Why is there a more of the same policy approach when we all very well know those policies have utterly failed? Its manifest of the amount of the koolaid being fed by our politicians which we are gullible enough to gulp down.

Last edited by samarjitdhar : 17th June 2012 at 11:10. Reason: multiquoted
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Old 17th June 2012, 11:18   #378
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Default Re: Govt plans to impose additional levies on diesel cars

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Originally Posted by pypkmsrikanth View Post
The question is should the first buyer alone pay the additional levy when in most of the cases the cars are sold off at about 5 years for a new car.
What about other taxes which are already imposed on a car? Why is the first buyer paying all those even if he may sell it off after 5 years?
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Old 17th June 2012, 11:57   #379
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Default Re: Govt plans to impose additional levies on diesel cars

In todays TOI (delhi times), i see many advertisement mentioning a cutout of diesel tax being levied soon. Is it for real anytime soon or just a threat?
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Old 17th June 2012, 17:28   #380
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Default Re: Govt plans to impose additional levies on diesel cars

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Originally Posted by samarjitdhar View Post
+1 to that. But why limit it to the cars. How about the mass transport vehicles? Not only there is mass flouting of anti-pollution norms by these vehicles and most of them plying on the roads are past their expiry date. These vehicles are not replaced due to populist policies until they have rusted to dust. While they are still running they are overloaded to the brink causing further pollution.
Oh yes, definitely. It may not be a popular move for sure, but will help the country in the long run. But then, are they really cared about the benefits (to the public)?

Itís funny because this is happening at an age when developed markets are moving away from fuel based taxation, and going more into emission based taxes.
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Old 18th June 2012, 18:17   #381
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Default Re: Govt plans to impose additional levies on diesel cars

The auto industry hits back Carmakers write to govt against additional tax on diesel cars - The Times of India.

Quoting a little bit from the article
Quote:
Siam claimed that diesel usage by passenger vehicles is about 6.8% of which only about 1.56% is for personal vehicles while the rest goes for taxis. Personal passenger car owners are ""miniscule"" and insignificant in the entire diesel usage, Siam said, adding that other industries were bigger consumers of the subsidised fuel.

""It is also pertinent to point out that much larger quantum of diesel is consumed by diesel-generating sets being used by offices, malls, residential complexes, shops, hotels, restaurants, mobile towers etc. for back-up power generation."

Siam also argued that excise duty on large cars is ""already high"" at 27% and any new tax will make them even more expensive.
Sometimes I think these guys are trawling our threads too .

Here is another quote
Quote:
He said diesel prices can be raised in phases which will also give the government elbow room to soften petrol price. ""In the first phase, price of diesel can be raised by Rs 2 per liter and simultaneously the price of petrol can be reduced by Rs 6... The above exercise can be repeated periodically after a couple of months till the price differential comes to a more sustainable level.""
So let's say in 4 months the diesel prices goes up by Rs 8 and petrol comes down by Rs 24 thereby restoring parity in between the prices. This also means the government takes in less tax revenue through petrol. Additionally to get a reduction of Rs 24 even states have to pitch in and say that they are going to collect less taxes on petrol which probably is not going to happen at all. The only thing about this whole issue is that middlemen would find this a perfect opportunity to push inflation through the roof.

Sorry for going OT: Is there a thread somewhere in TBHP about this whole shindig about retail FDI? I don't quite get it and do not even understand the reason as why everybody is hankering for it. Is the retail industry suffering badly or is it another money making scheme for the next election?

Last edited by samarjitdhar : 18th June 2012 at 18:19.
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Old 18th June 2012, 19:28   #382
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Default Re: Govt plans to impose additional levies on diesel cars

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Originally Posted by LandCruiser View Post
It should not be the first buyer alone. Tax should be for the year on year usage and not for "purchasing". ......To improve on margins due to reduced diesel car sales car manufacturers might in turn increase petrol car prices. As customers would have no choice to but to buy a car anyway if they want to.
Then how will this be different from say a Rs.10 per litre rise in Diesel prices. Unless you go for dual pricing there is no other option. Dual pricing will be like LPG - chaos personified.
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Old 23rd June 2012, 22:20   #383
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Default Re: Govt plans to impose additional levies on diesel cars

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Originally Posted by LandCruiser View Post
It should not be the first buyer alone. Tax should be for the year on year usage and not for "purchasing".
Year-on-year taxation isn't something that seems fair. I drive 25kms a month (and my car is my only means of transport). There are folks who do a few thousand kilometers a month. Paying a 'diesel cess' when re-fueling a car from the second year onward may be more reasonable - though it's just like a price hike and is what they are trying to avoid.

Last edited by k_nitin_r : 23rd June 2012 at 22:22.
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Old 24th June 2012, 20:35   #384
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Default Re: Govt plans to impose additional levies on diesel cars

Got this information from a Volkswagen SA.

The Polo diesel is going to be costlier by around 50K and Vento diesel by over 75K. He also confirmed that the two Passat in his stock got immediate booking on diesel price hike fear.

Also got a message from Trident Chevrolet which said:Rush!!! before the price hike for diesel cars-Excise duty revision.Book your cars and register it before June 30th.

If anyone here is planning to buy a diesel car, you know what to do
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Old 24th June 2012, 21:15   #385
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Default Re: Govt plans to impose additional levies on diesel cars

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Originally Posted by PrideRed View Post
Got this information from a Volkswagen SA.

The Polo diesel is going to be costlier by around 50K and Vento diesel by over 75K. He also confirmed that the two Passat in his stock got immediate booking on diesel price hike fear.

Also got a message from Trident Chevrolet which said:Rush!!! before the price hike for diesel cars-Excise duty revision.Book your cars and register it before June 30th.

If anyone here is planning to buy a diesel car, you know what to do
Do the VW & Chevy know something that no one else in India know ? Is the excise duty revision DECIDED and the government has privately and confidentially communicated to the VW and Chevy including the magic date of June 30th and the exact amount ? Just wondering is it an option to file a FIR against rumormongering dealers
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Old 24th June 2012, 22:56   #386
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Quote:
Originally Posted by PrideRed
Got this information from a Volkswagen SA.

The Polo diesel is going to be costlier by around 50K and Vento diesel by over 75K. He also confirmed that the two Passat in his stock got immediate booking on diesel price hike fear.

Also got a message from Trident Chevrolet which said:Rush!!! before the price hike for diesel cars-Excise duty revision.Book your cars and register it before June 30th.

If anyone here is planning to buy a diesel car, you know what to do
They seem quite desperate. Maybe it's because of sales falling way short of target and inventory build-up, but trying to panic customers into buying is not very ethical.
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Old 24th June 2012, 23:04   #387
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Default Re: Govt plans to impose additional levies on diesel cars

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Originally Posted by idofsuresh View Post
Do the VW & Chevy know something that no one else in India know ? Is the excise duty revision DECIDED and the government has privately and confidentially communicated to the VW and Chevy including the magic date of June 30th and the exact amount ? Just wondering is it an option to file a FIR against rumormongering dealers
Even i am quite confused. No info anywhere else on slapping additional duty by June 30th and was surprised on the info i got.
I am not quite sure if FIR would help, but definitely a mail to respective manufacturers would help in getting some vital info.
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Old 25th June 2012, 08:07   #388
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Default Re: Govt plans to impose additional levies on diesel cars

The recent drop in the demand of vw cars leading to growing inventory and this is leading to this kind of rumours for sure.
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Old 25th June 2012, 08:10   #389
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Default Re: Govt plans to impose additional levies on diesel cars

This was the same fear that was being used against customers before the budget (about 80K increase in price of diesel cars). Govt has been incredibly numb before, but I hope that they don't want the investments in India to stop (from the automotive industry) - With the whole world stalling into a terrible economic slowdown, there should be at least some markets in the world, a little consumption is good.

Diesel cars are more expensive to produce - Not just the engines are heavier but there are many more components that are involved - turbos, intercoolers, fuel injectors etc. I am sure they charge a premium too, but not as much as most of us think of it to be.

If govt thinks it is indeed subsidizing the diesel for consumer cars, which amply has been shown to be a farce, one-time diesel cess for the cars seems to be the logical way to go. Differential pricing will not help. But, what it does not do is that it does not penalize the Diesel Generators used by huge complexes and most importantly, cell phone towers.

To avoid losses due to subsidy, in the case of diesel, the optimal solution is to bite the bullet and avoid the subsidies. In this case, consumers of diesel will pay what it is worth (including mobile phone tower operators, DG owners etc) - Otherwise, the problem is not solved because SIAM data points only 1.56% of the whole chunk belongs to diesel car consumers.

After Government's silence/inaction in SC verdict on sun-films, I have lost all hope in Govt and also SC. Never have I felt so helpless in recent past.
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Old 25th June 2012, 19:42   #390
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Default Re: Govt plans to impose additional levies on diesel cars

I was at Mahindra dealer in Bangalore, and they told me this tax is going to come by July 1st. they added 'maybe sir'.


Any idea if its really the truth? the same is being voiced at office by a few colleagues who read news
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