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Old 5th March 2010, 16:41   #1
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Default Karnataka Car prices to go up due to increase in VAT

Karnataka Budget news:

Increase in Value Added Tax:
Value Added Tax rates, will be increased from 12.5 per cent to 13.5 per cent and from 4 per cent to 5 per cent with effect from 1.4.2010
Life time tax on motor cars and jeeps will be modified as follows
1. Vehicles with selling price less than Rs.5,00,000: from 12 per cent to 13 per cent
2. Vehicles with selling price from Rs.5,00,000 to Rs.10,00,000: from 13 per cent to 14 per cent
3. Vehicles with selling price from Rs.10,00,000 to Rs.20,00,000: from 16 per cent to 17 per cent
4. Vehicles with selling price more than Rs.20,00,000: from 16 per cent to 18 per cent

Last edited by bimi : 5th March 2010 at 16:43.
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Old 5th March 2010, 16:45   #2
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OMG. First the registration or the road tax itself is so high and now add to this the VAT. So no time to hide for buyers and sellers.
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Old 5th March 2010, 16:46   #3
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Crazy. When taxes are being rationalized across the country, Karnataka goes the other way.

We always had the highest selling price for cars and fuel - now the gap is getting wider! first in at least one area!
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Old 5th March 2010, 17:02   #4
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As if the TAX and VAT weren't the highest in INDIA we have an increase on the same now .

What next????????
Start charging VAT on fuel at fuel stations as well
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Old 5th March 2010, 17:35   #5
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daylight robbery!!! how much more would they increase the vat/tax? soon we would spend 100% of car value on taxes to state in Karnataka, and suddenly importing a car would not seem so costly. what a day it would be!
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Old 5th March 2010, 18:03   #6
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Oh man. This is ridiculous. Karnataka has one of the worst road network but still the highest road tax. Now to add to that higher VAT as if the excise duty increase was not enough.
Petrol is also dearer by 2-3 rupees. I guess the good times are behind us!
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Old 5th March 2010, 18:04   #7
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This is sheer robbery. Karnataka is the country's highest taxed state to begin with.
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Old 5th March 2010, 18:10   #8
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This country is never going to ever improve. Instead of being one country we are being individual states with different tax structures and all this money is going to these politicians pockets. The comman man has to suffer. Even the Fuel prices are the highest in the country.

Karnataka is the highest in everything. Sheer madness.

MERA BHARATH MAHN!
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Old 5th March 2010, 18:22   #9
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Haha all i can do is laugh!!
the government here is a joke.
i still remember just before the recession.
fuel prices had reached close to 58 bucks. Our so called leader promised he would reduce taxes to consolidate the fuel price.
what did he do?
Nothing But attending a few weddings and taking family pictures.

Highest tax in india for vehicles , Most expensively priced fuel ,poor state of the roads.
expect more and more outside state vehicles being purchased.

I believe the governments lack of administrative skills for managing the state's economy is substituted by increasing tax.

No wonder people are moving away to different states from Karnataka .

For some reason i started Loving my Sig Even more

Last edited by vinaydas : 5th March 2010 at 18:25.
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Old 5th March 2010, 18:57   #10
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I don't blame Karnataka govt much. It is the result of price insensitivity of Bangaloreans in general. Think about it - who is not looting a Bangalorean ? Go to retaurant, any resort in Karnataka, multiplexes, high end shopping, try to buy properties, try to hire a cab - everywhere you will find overpricing with no negative impact on demand. People are ready to spend - price no bar. KA govt is just cashing in on this opportunity to raise fund for itself. Had we shown our sensitivity to prices, it would have been a completely different story overall.

We should be thankful to KA govt that we still have one-tax regime for the entire state. I will not be surprised if a time comes when Bangalore will be taxed differently than the rest of the state.
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Old 5th March 2010, 19:07   #11
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sabynag, I totally agree with your comment. It's been 8 years since I'm in Bangalore and I can see this trend.
But come on Govt, atleast give us better roads to drive on. Taxes are sky high and infrastructure is too bad!
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Old 5th March 2010, 19:08   #12
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VAT on Fortuner is approx. 3 Lakhs? Unbelievable!!!

Quote:
Originally Posted by sabynag View Post
I don't blame Karnataka govt much. It is the result of price insensitivity of Bangaloreans in general.
But the tax is for the entire state, not specifically for Bangalore alone.

If this is reason, then over a period of time, there would be skewed social structure. Only the rich will be able to afford luxuries. This will lead to social imbalances.

Has these higher tax rates got anything to do with Karnataka repeatedly being governed by the opposition party at Centre? During Vajpayee time, KA was under Congress. Now Congress is at Centre and KA has BJP led govt.

Just wondering whether KA is getting its share of centre budget allocations? The income tax being collected by Centre, is it finding its way back to Bangalore?
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Old 5th March 2010, 19:20   #13
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Bangalore is one of the most heavily taxed cities in INDIA
The Bangalorian Cash Insensitivity Syndrome..

KARNATAKA S SIMILARLY TAXED
Dont know yy ?
May be the capital is Bangalore
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Old 5th March 2010, 19:42   #14
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Reduce the temptation to consume. Say a firm NO to overpricing. All prices, including taxes will come down.

Remember one economic theory : High tax brings ZERO revenue if it results in NO SALE
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Old 5th March 2010, 19:49   #15
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How many people will be affected by raise in car prices?

What percentage of central taxes paid by Karnataka comes back to the state? I dont think its a big issue if car prices go up.
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