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Old 8th January 2007, 16:08   #1
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Default Excise duty cut ???

Any take on the following happening,

- bikes down to 8%
- small cars down to 12% (with a change in qualification by increasing capacity to 1500cc???)
- other cars down to 16%

If so cars will cost that much less from 1/Apr ???

And what about the insurance rate cuts to have taken effect from 1/Jan. Sounds like cars will be dirt cheap...............or is it just all hogwash ???

Advise on every point above, please.

Cheers
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Old 8th January 2007, 17:43   #2
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The goal is eventually to move to a single rate of excise for all categories. The suggested rate is 12% or 16%. Personally, I think 16% is more like it. That should be kind of a floor.

Small car definition may change. Some newsreport a few days back said that the engine cap. guideline may be scrapped. And the length restriction might change from 4.0 M to 3.8M. If this happens, Swift will qualify for small car, but Getz & Aveo will not make it.

BTW, car manufacturers never pass on the entire benefit to consumers.
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Old 9th January 2007, 13:02   #3
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Last year every small car manufacturer passed on the entire 8% duty cut to the end customer, right? I distinctly remember Santro was down 25K+ and so was the Indica, Alto, etc.. With so much cut throught competetion, why wouldnt they pass it on??
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Old 9th January 2007, 13:08   #4
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As long as Unca Chidambaram is FM, forget duty cuts, if he does cut somewhere, he will get you somewhere else.
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Old 9th January 2007, 13:43   #5
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Quote:
Originally Posted by Equus View Post
Last year every small car manufacturer passed on the entire 8% duty cut to the end customer, right? I distinctly remember Santro was down 25K+ and so was the Indica, Alto, etc.. With so much cut throught competetion, why wouldnt they pass it on??
they did cut the prices after the excise cut. but with in months they all hiked the prices saying that input costs increased. none of the manufacturers except TATA reduced the prices after VAT is introduced. all of gained form VAT as they get credit for input VAT. only TATA reduced indica prices by 7K. now also one can see all manufacturers singing the tune of increased cost of production and increasing the prices. some of them already increased the prices. they knew they have to reduce the price once excise duty is cut. so in advance they are increasing the prices. so even if they reduce after excise cut their margins will be more
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Old 9th January 2007, 13:49   #6
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Quote:
Originally Posted by Equus View Post
Last year every small car manufacturer passed on the entire 8% duty cut to the end customer, right? I distinctly remember Santro was down 25K+ and so was the Indica, Alto, etc.. With so much cut throught competetion, why wouldnt they pass it on??
Last year when the cut the price, they also removed the discount they were giving. In effect, the duty cut was used to compensate for the discount. Yes, they also raised the price later citing input costs. Initial reduction in excise duty may not really translate to actual reduction in the price paid by the customer.
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Old 9th January 2007, 14:02   #7
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Agree completely with you guys - I was only stating that they did pass the cut last year.. What happened later with the hikes is another story..

If indeed this duty cut is to happen, and say I plan to buy around end March '07, I should be getting the freebie's along with the reduced prices?
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Old 9th January 2007, 14:25   #8
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Quote:
Originally Posted by esteem_lover View Post
As long as Unca Chidambaram is FM, forget duty cuts, if he does cut somewhere, he will get you somewhere else.
Expect service tax on tyre repairs, tow trucks for breakdowns, car washes and special withdrawal tax if you withdraw cash to pay for a car.
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Old 9th January 2007, 14:58   #9
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Quote:
Originally Posted by Steeroid View Post
Expect service tax on tyre repairs, tow trucks for breakdowns, car washes and special withdrawal tax if you withdraw cash to pay for a car.
Man, i thought you were gonna say withdrawal tax for withdrawal symptoms. LOL. i might as well continue with my drinking, i guess.
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Old 9th January 2007, 15:09   #10
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Quote:
Originally Posted by Steeroid View Post
Expect service tax on tyre repairs, tow trucks for breakdowns, car washes and special withdrawal tax if you withdraw cash to pay for a car.
Taxes on pollution, emission, water used for washing (servicing), road wear and tear due to tyre marks etc etc
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Old 9th January 2007, 17:40   #11
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Nothing on the INSURANCE bit in my query? Please advice!
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Old 6th February 2007, 16:15   #12
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Default Excise duty cut from 16% to 8% for small cars

Hi Guys,

I have heard in News and also from BHPians that the excise duty is coming down to 8% instead of 16% on small cars which has less than 3800 mm length and less than 1200CC (petrol) and 1500CC (Diesel) engine specifications. I am planning to buy a Swift VDi diesel which is applicable for excise duty cut.

Can you please let me know when will the new prices will be out after excise duty cut as I am aware that the budget will be announced on 28th Feb and the next price list in 1st week of March will do. Please throw some light on this.

Thanks
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Old 6th February 2007, 16:46   #13
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Default Bettre to wait till budget?

I think the duty will be rationalized. Is it better to wait till budget to buy new car?

The redefinition of "small car" is unfair to Hyundai, GM etc. They have made investments to meet small car norms.

I have a feeling that even if excise is cut manufacturers will withdraw discounts. Did this happen last year?

On another note, launch of Logan (Petrol & Diesel) may start price war.

In short it is better to wait & watch.
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Old 6th February 2007, 16:52   #14
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Nobody knows for sure if this will happen.
Gotta wait till Feb 28th.
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Old 6th February 2007, 20:24   #15
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Would like to know from you guys, if the excise duty comes down in the budget, will it take effect in this financial year means in march itself or it will start from April onwards. It would be better if anyone can share his/her last year experience.
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