[Nilesh5417]

Originally Posted by naru80

This is a very nice illustration about the taxes you pay towards car ownership. It's slightly dated though, because fuel taxes are higher now.

Worth reading the article along with it:

https://timesofindia.indiatimes.com/...-of-the-stick/

This is a really nice summary of overall cost of ownership of a vehicle.

BTW - corporate taxes are either going down or are stagnant. Indirect taxes are only going up. Freebies are being reduced by center but states don't want to understand the economics. Inflation is eating into savings lying idle in your bank. Grim scenario if you are salaried.

No wonder finance gurus say - start a business, build passive income streams, make investments a habit early on, buy adequate insurance (health & life) etc..

[jaaz]

Taxation is high because of the mismanagement of the Politicians. Let them come out with a White Paper on the government expenditure and we'll know the exact expenditure on poor and politicians.

Everyone is talking about Freebies to the Poor, but no one is bothered about the Freebies to the Politicians. Both are wrong. But, if you compare, then Politicians are taking Freebies equivalent to crores of population. My guesstimate would be each Politician gets Freebies of at least 1 million poor.

We think of economics, whether to take Car or Train or Flight for a journey, but Politicians don't blink before spending 30-40% of the budget on themselves.

Do you want to cut down the Salary of Workers by 10% or the Salary of the CEO. An average CEO earns a salary equivalent to 10,000 workers.

Corporate taxes should be raised and Individual taxes should be reduced. But it's being done vice versa. So, it's anyones guess, why we are seeing so many corporate scams.

[gungax]

When I was looking for a Premium car last year, a conversation with my brother who lives in another country was a major contributing factor on the car purchase.

I told him I was willing to spend 85 Lakh for a new car. He told me to consider something much cheaper. It is not about affordability, it’s about ethics he said.

At 85 laks, about 40 will go into taxes. These taxes are mismanaged and blatantly, openly used to fill the pockets of individuals. Taxes are a necessity but unfortunately here, only a small part goes to those who actually need it.
I am happy I settled for something almost half the price. I still have a fun car and with the extra money I can continue doing my road trips all over the word on brilliant and picturesque roads.

I don’t believe a long rant about the obnoxious government officials during my dealings with them in a professional capacity will change them. I believe it’s better to try and improve the system in any way we can.

[whitesportz 1.2]

Originally Posted by real_koolkrish

What are the best countries to be a Car Enthusiast ?

The answer is quite obvious... Germany DE

[GTO]

Mod Note: As per our forum rules, strictly no discussion on politics, politicians or political parties please.

Thanks for the support & understanding

[aniyo]

There is a very good video on youtube called rule for rulers. Do check it out

See the tax and policy is always influenced by the power groups and not by a nations well being as we like to believe.

The rulers will have to rule through channels, be it military, farmers group or any other group.
The groups with strongest lobby and clout will get maximum attention from the rulers and that is how the system works.

For government the core support group are the Farmers (For votes), Corporates (for wealth) and the bureaucracy to draft and implement their policy effectively.

The salaried class and the MSME sector is not very relevant from a power play point of view and hence we get the raw deal. MSME atleast has some association to put their case, infact despite this they got little supprt from government during GST and pandemic.

In many European countries, the bulk of the voting population are the educated, service sector working class and hence the policy reflects the same. The massive disparity in India and the heterogeneous nature of our country make it easier for rulers to break us into groups and target that give maximum returns

As far as I see the government will continue to tax the salaried class on consumption and TDS will be there forever. The deductions provided to us on Home loan was a demand from the real estate lobby and not for our welfare.

I think the centeral government should stop collecting income tax and outsource this to State government and Center should take their cut. This will motivate the state government to improve collection or worse case it will bankrupt the sate will all freebies.

[NYMEX]

The prices, taxes and state of the country are known before you buy a car. Intelligent folks work out the cost of ownership before the purchase and make a decision accordingly. The simple issue is about affordability and the buyer cannot blame anybody for a wrong buying decision.

If the expected enjoyment is not as expected, then the purchase was made based on incorrect assumptions. So unrealistic expectations cannot become the fault of the state.

I was a student in the 1980's when my dream was to own a white fiat with a music system. Airconditioned cars were an unrealistic expectation back then and hence not a part of the dream. I did not blame anyone about a 17 year wait list for bajaj scooter or lack of choice of cars or poorly paid middle class. We worked our way and have come a long way since then and do have a long way to go.

(I am thankful that my garage has a i10, Toyota Altis and a C-200 Edition C, however automobiles are not a priority any more.

Been there, Done that )

[thanixravindran]

Originally Posted by V.Narayan

God Almighty! Another whining, moaning, groaning, bitching thread by the top 1% or 2% of the population.

So it is our right to criticize and we should but let it be informed criticism and not the usual India sucks lament.

Hello Mr. Narayan - Thanks for your yet another insightful post. I am from post liberalization generation and won't know about the previous era except from our parents or reading about it in books or from people from you. Yes, we have come a long way and there is even more treacherous path ahead of us. However, I think the OP has written the reason for the thread - Fairness(?) of more than 50% taxes in On road car price and to raise awareness behind the Ex-showroom price. In my opinion both are valid points and not just ranting.

1. I consider the first one to be unfair as excessively high tax raises the base price and acts as barrier to own a 4 wheeled private vehicle even at entry level. I always thought it is fair to increase the base (people who can own a car) to spread the tax burden more uniformly. I am sure many will argue that it depends on the purchasing power and dependent on import fuel, etc but in my opinion it is not the answer. How much scientific investment has been made to find alternate fuels or incentives given at least to improve the efficiency (except FAME) without compromising safety? If the base does not grow, it will be counter productive to innovation as companies won't spend the money in R&D. I agree that there will be profiteering when actual cut in taxes will not be passed which I believe is already take care in the law (may only be words). In the example you have quoted on telecom sector, I believe the growth would have stunted if the tax incidence was too high (including the license and spectrum fees). It is only my belief as I don't have any data to back it. Upcoming 5G result may validate this claim.

2. Previous to GST regime, when VAT was in place, I guess many excise and duties were hidden. With GST, it is quite transparent but hidden in the plain eyesight with the notion Ex-showroom price or MRP. My wife did not expected the Mid Variant Skoda Kushaq was unit priced just at 8.8 Lakhs and was really surprised that we paid 15 Lakhs for it. I don't know what is preventing from advertising base price + applicable taxes in all the goods sold in this country which I asked earlier.

I know of many people who does not know about this or the taxation of white goods like ACs. I think one member rightly pointed out how the Air Conditioning units are at 28% GST slab ('Sin' goods may be due to Carbononization potential? or just white goods taxation, I don't know). So a person who likes comfort in the tropical climate but still aware of the energy efficiency opting for a inverter unit pays Rs. 32,000 (minimum out there) out of which Rs. 7,000 are just taxes. Will it not be better to have 'less' tax incidence rates at least on the basis of energy efficiency (I am fully aware that European countries imposing taxes on using Air Conditioning systems)?

I believe our principle on pollution is 'polluter pays'. So is it not better to come up with differential taxation based on pollution, efficiency and safety in automobiles? I thought our famed bureaucracy is supposed to research, analyze and come up with these type of tax solutions (I am sure they can as one needs to be in the top cream to even get selected in Indian administration services unlike politicians) for the betterment of the taxpayers and Government.

Business exemptions/depreciation:
Many including me pointed out that company registration (businesses) or company car lease for Salaried is better option given the tax exemptions and depreciation benefits allowed. I have slightly different biased perspective since I am salaried -

I don't subscribe to the view of 'Salaried' Vs 'Business'. Salaried people are also business person - They don't deploy capital but their time/sweat/brain but for a less risky and more known returns. They offer their services with 30 days interest free credit to the companies they work for. They do fail in their endeavors and try something else (Career change like change of business). And I guess they are restricted in doing multiple jobs/payrolls at a time unlike business. But they don't see the rent collectors on daily basis like business to even earn the money (they do give, only when spending in select avenues). They do change their jobs for better returns.

I believe the laws on the Income tax were written just after independence and provided the much needed balance as Government jobs are permanent and is the only formal job creator (Zero risk). Except for a very small nascent private manufacturing sector that is salaried (and unionized) and rest is split between traders (limited and hence business exemptions to protect the capital) and agriculture (predominant and no income or profession tax). Unfortunately, this notion of 'Salaried' as something permanent till and post retirement has stayed on even after liberalization. Reality is it is not except for Government jobs, Quasi Government jobs or labor union backed jobs to a certain extent. There absolutely is no less risk taking in private sector jobs than business that I believe majority of the forum members fall under including me.

And it is amusing, in the same roads (congested due to the same vehicles) that both jostle to get their 'business' carried out but are treated different for taxation. Apart from the transport sector, I could not understand how this is justified for businesses. So I become an 'Agony aunt' when there is a vent given in form of a thread. Shouldn't the bureaucracy correct this anomaly at least in 2020s? No, wait, they are busy terming 'private salaried' employees are just contract employees (at least they got this correct) and refuse to consider them even for valid BH registration (Karnataka example) after a clear notification allowing it. This unfairness (not arbitrariness as Government babus are known to come up with any level of justifications even in the top court) manifests in many ways and taxes become the favorite whipping boy.

[ninjatalli]

Originally Posted by V.Narayan

So it is our right to criticize and we should but let it be informed criticism and not the usual India sucks lament.

+1

-----------
I think the people cribbing/criticizing in this thread need to be realistic in their expectations. I get the feelers of multiple complaints in this thread posts

#1. The obvious one of a salaried individual paying a ransom to the govt from his hard earned post-tax (/in-hand) money of his

#2. Business folks getting the easy way out while a salaried individual doesn't get that option

#3. Not so great RoI on the taxes being paid (wrt to road infra, etc.) and then being asked to pay tolls over it and pay a ransom again for the fuel

Complaints #1 & #3 are unavoidable. Whatever be the argument, this is how the country's economics is going to be and those living here will have to accept it. The earlier folks like OP accept this, the better will be their lives.

And wrt to complaint #2 there are alternatives for salaried folks. This forum has been shouting about this option LOUD and CLEAR since ages - pre-owned cars.

Used cars are a godsend - if one does their research well, they come at an excellent discounted price, one doesn't have to pay any of those insane shitty taxes to the government and gets a larger choice of options across manufacturers and segments depending on their requirements. And better to do this before the govt realizes this "loophole" and closes it.

[v1p3r]

Originally Posted by V.Narayan

God Almighty! Another whining, moaning, groaning, bitching thread by the top 1% or 2% of the population by wealth & income of how tough life is for us poor luxury car buying, foreign holiday going, upwardly mobile citizens.
...
...
So it is our right to criticize and we should but let it be informed criticism and not the usual India sucks lament.

With all due respect, let me ask this - why should the disproportionate burden of nation-building fall to only the honest tax-payer? Why should s/he have to suck it up and deal with bad roads, bad healthcare, bad education, bad environment, government and police harassment, all for the privilege of paying 30-97% (historic) income tax?

Let me also ask why we must be happy with what little progress has been made in decades, while other large countries (there is only one really) have made rocketship progress in comparison, ensuring much better standards of living for even their poorest.

A young professional in India yearns for the same standard of living as s/he sees in the west or anywhere else. If s/he is paying 30% in tax just like in the US, s/he has the right to expect similar public services and infrastructure just like in the US. Patriotism is well and good - my family members sacrificed their lives to ensure we live free - but taxes are a transaction between a state / merchant and a citizen / customer. If the government is not able to build infrastructure to keep up, such professionals will leave. There is already a mass exodus underway in certain fields, and to my knowledge it hasn't been this bad since the 1970s, which produced the Khoslas and the Dhams, not for India but for the US. Offshoring of wealth has also gone through the roof in the last two years, a sign that ought to scare the daylights out of any half-competent policy maker.

Originally Posted by Dosanova

data in per 1000 people

Amsterdam - 247

Tokyo - 232 (as of 2013)

Seoul - can't find proper data

Beijing - 209

Hongkong - 106

Mumbai - 190 ( 4mil cars and 20 mil people)

Delhi - 556

Bengaluru - 640

Hyderabad - 344

Indian cities have much higher vehicle densities and I'm not sure if infra can keep up (even with money) the better solution is to promote transit like Japan. and we have some historic handicaps like disorganised road layouts and narrow roads

This data is incorrect.

The statistics for the international cities may be correct - they are for AMS - but for Indian cities they are vehicles per 1000 people, not cars. This includes two and three wheelers. That is why BLR is so high - it is the 2-wheeler capital of India, and possibly by extension the world.

BLR's car density is 125/1000 people, which is approximately half of AMS.

There is no excuse for our pathetic infrastructure.

[ABHI_1512]

Originally Posted by V.Narayan

God Almighty! Another whining, moaning, groaning, bitching thread by the top 1% or 2% of the population by wealth & income of how tough life is for us poor luxury car buying, foreign holiday going, upwardly mobile citizens.

Quite a generalisation Narayan Sir. With due respect to you and your thoughts, just because someone earns better than many, doesn’t mean that one should not care about the money one spends. One should have every right to ask questions if that someone is seeing the hard earned money going as taxes which is disproportionate, specially the salaried class.

Taxes are necessary and we all know that. We all agree, more so in this thread. But when we see that corporate taxes have steep reduction and that, there is no change in personal income tax slabs, then one does feel shortchanged as a salaried individual. Policy decisions can always vary, but it should not be at the cost of people. The merits or demerits of corporate tax reduction can be a topic of another discussion altogether, I just mentioned it out without going into the details of it. My gripe here is only about the treatment of salaried class.

Here, the OP is able enough to buy a Kodiaq. I am sure he has worked hard enough to earn the amount of money that enabled him to buy the car. But that doesn’t mean that he can’t complain. He is not complaining about some loose change or a mud flap not given, he has just given a scenario where he paid almost 16 lakhs more as taxes !! I am sure this post would not have been in the forum, had the taxes hovered around 5 lakhs or even 10 lakhs probably.

Today, a small car at the low end of the spectrum almost demands a tax payout of more than a lakh roughly. So a person who is not earning so much as OP would still be paying the taxes which are disproportionate and that is what we are discussing here. Salaried class is the most abused one and we all probably know that.

Sorry for going little off topic here but people like Mallya can hoodwink the authorities for years without batting an eyelid but a salaried guy defaults on loan repayments, he will be put to jail and the key thrown away in some river !! Most of the replies in this thread echoes the disappointment, knowing fully well how direct taxation and indirect taxation works for the salaried class.

And about your point of taxes running the country, I agree with you fully. Just that those taxes also fund many freebies and sadly those freebies start from the top and not from the bottom as many would like us to believe !!

[vipul_singh]

Originally Posted by Jangra

I recently bought a Skoda Kodiaq - Sportline trim for which I paid Rs 43,81,800. For this discussion, I would keep the extras like Maintenance pack, Fast Tag, Accessories etc aside and just focus on Ex-showroom, RTO and Insurance - which was 42lacs. Below is the breakup

[

Either focus on earning more, or buy a cheaper car if it is pinching. No point in lamenting.

As far as I am concerned, the sheer satisfaction of watching my country develop is far more than what owning any fancy car can get me. I support high taxes, so long as they are being spent well enough and the overall development is on the right track.

And before this turns political, i believe all political parties have contributed to gradual development to varying degrees and in varying ways.

[aniyo]

I understand many people are criticizing the difference in tax pay out between business owners and salaried class.

One key point people miss is the risk factor. Business people invest money and there is risk involved if things don't work out. No one is going to come to rescue if things fail. High risk high reward.

Also running a business is not easy in India. Ever changing rules, greasing palms and ego-massaging of government officials, number of paperwork to maintain, there are a whole lot of issues for a business person.

I agree the exemptions given to business are slightly more but they are also taking risk, revolving money in the market and at the risk of sounding political, need to fund association or election depending on business.

[parrymx5]

An honest citizen paying tax still has to bear the burden of extremely high healthcare costs, education costs, unsafe dangerous roads, unsatisfactory safety arrangements, high indirect taxes like GST and Fuel tax, plus registration taxes on our beloved automobiles, meanwhile, 90% of all politicians irrespective of their political affiliation do not care and are focused on doling out freebies paid by the middle class to their vote bank, and then they talk about grand things like a 5 trillion dollar economy as if the very politicians and bureaucrats have not stifled consumption in the first place by imposing insurmountable barriers.

The middle class pays the most and is the most ignored section since we neither have the population to consolidate power nor the vast amount of monetary resources.

Sorry if this feels like a rant.

[Acharya]

While being a BHPian, one always feels the urge to upgrade the steeds. I've been upgrading cars every 4-5 years in last 15 years or so. But this time, I have no such plans despite 1.8 TSI DSG being 4+ years old already.
Reasons - A proper upgrade from current car would set me back by 70-80 big ones and will make government richer by 30-40L. I have no intension of doing this mean trade in foreseeable future.
Do I hear, Kill the Golden Goose, in the background