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Old 23rd January 2013, 08:58   #1
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Smile Expectations for the Auto Sector from Budget 2013

BHPians,

Now that Budget 2013 is at the corner what should be the auto sector's expectations from the budget 2013 as per BHPians. Since the auto industry is experiencing a slowdown, what measures should the govt in its last year of tenure provide to boost the sector. Will the govt hand a sweet pill for the sector as this will be the last budget before the general elections in 2014. Last year the Diesel cars were spared from the anticipated tax, however excise duties were hiked which resulted in the jacking up the car prices. Most of the car manufacturers are already reeling under the losses on account of huge discount provided over the last festive season, the hike have spilled into the new year too. For last years budget outcome for auto sector pls see the wonderful thread by GTO.
http://www.team-bhp.com/forum/indian...need-know.html (The 2012 Budget & the Indian Car Scene : All you need to know)

So what according to BHPians can the auto sector expect from this budget? Have broadly classified the expectations into sections as below:

1) Personal tax: Will the tax slabs be tweaked to allow more income in the hands of individual which will allow spending on the buying of vehicles. Also will the govt increase the age old transport allowance exemption from the measly 9.6K per annum to realistic figures?
2) Excise duties: Last year the excise duty hikes had increased the car prices across the segments, will this time the FM be generous to reduce the same to allow affordabilty for the buyers.
3) Insurance: Over the last few years the motor insurance have been on the rise, although the norms are dictated by the IRDA, will FM allow any benefits such as exemption from IT on Insurance premiums paid for vehicles.
4) Promotion of hybrid vehicles: What sops will the budget unveil as far as hybrid vehicles are considered as a part of saving environment?
5) 2 wheeler/Commercial vehicles segment: What will the budget surprise be for these segments?
6) Highway Infrastructure: Will the govt give enough incentives this budget to put the infrastucture in the fifth gear for the development of better & quality roads and highways?

BHPians - Request to put your thinking caps and start jotting down. Feel free to add any categories which I may missed.

Last edited by GTO : 23rd January 2013 at 12:21. Reason: Fixing typo
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Old 23rd January 2013, 09:47   #2
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Default re: Expectations for the Auto Sector from Budget 2013

These are some sxpectations (Not all are related to budget)

- Pricing of Diesel.
- Excise increase for Diesel SUV.
- Excise reduction for CBU (Not sure about CKD)
- CNG availability in new cities
- Increase in RnD expenditure benefit.
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Old 23rd January 2013, 09:49   #3
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Default re: Expectations for the Auto Sector from Budget 2013

Quote:
Originally Posted by ghodlur View Post
So what according to BHPians can the auto sector expect from this budget? Have broadly classified the expectations into sections as below:

1) Personal tax: Will the tax slabs be tweaked to allow more income in the hands of individual which will allow spending on the buying of vehicles. Also will the govt increase the age old transport allowance exemption from the measly 9.6K per annum to realistic figures?
With Chidambaram being there, all you can expect is increase of another 20K on the base exemption. On the other hand expect the service tax to go up. So net nil effect for the salaried class.


Quote:
2) Excise duties: Last year the excise duty hikes had increased the car prices across the segments, will this time the FM be generous to reduce the same to allow affordabilty for the buyers.
I dont see a cut in the excise duty happening unless there is serious lobbying from the auto sector side.

Quote:
3) Insurance: Over the last few years the motor insurance have been on the rise, although the norms are dictated by the IRDA, will FM allow any benefits such as exemption from IT on Insurance premiums paid for vehicles.
If this happens, it would be very nice, however, the chances are remote.

Quote:
4) Promotion of hybrid vehicles: What sops will the budget unveil as far as hybrid vehicles are considered as a part of saving environment?
This was supposed to happen long time back, the sops should have been provided and the local manufacturing of hybrids should have got priority due to sops and incentives.

Quote:
5) 2 wheeler/Commercial vehicles segment: What will the budget surprise be for these segments?
Not too clear about this, with the increase in the diesel prices, this sector is already under pressure. The fringe players will definitely cease to exist.

Quote:
6) Highway Infrastructure: Will the govt give enough incentives this budget to put the infrastucture in the fifth gear for the development of better & quality roads and highways?
This is long due. The 20 km highways built per day is still on papers and has not got materialized.

Quote:
BHPians - Request to put your thinking caps and start jotting down. Feel free to add any categories which I may missed.
With the elections due in 2014, the govt will be more worried in bringing up policies to appease the vote banks rather than the actual policies/funding for the sustained growth of the economy.
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Old 23rd January 2013, 10:08   #4
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Default re: Expectations for the Auto Sector from Budget 2013

Chidu is known for sugar coating the bitter pills. He might announce few thousands of benefits and then load more taxes. Off late he is talking about GST isnt it.

What happened to the original recommendation on DTC ? congress is waiting for pre-Election budget ?
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