Team-BHP - Consumer Diesel on a Premium?

We all have been craving for Diesel cars which are oh so good for fuel economy but not good for environment. Everyone is rushing to book Swift/ Dzire VDi, Palio Diesel, Ford Fiesta Diesel, etc. I am forced to think that would someone still buy a diesel car if

1. Diesels cars are sold with a higher tax to save the transport fuel & environment,

2. Diesel for Transport use and consumer use is separated and the second is sold on a high premium (may be almost at par with Petrol).

Say what your opinion is ?

-> Mods, I am not sure how to add a poll. Please approve this with a poll for yes or no.

Quote:

Originally Posted by given2fly (Post 850973)

Well I am definitely in favor of Diesel sold at no premium for cars! [ I might be biased though knowing that I drive an Alto]. I think Car owners are "welathy" enough people in this country and it makes no sense to subsidise them in any sense. In fact I wont even feel bad about government actually putting some special tax on cars and using that amount to provide better public transport (better buses or roads). Definitely the number of cars in cities have to go down (especially the likes of Scorpio/Safari etc).

In any case probably in cities like Delhi this kind of debate might not have much significance in future as people will probably go for still cheaper fuels like CNG or LPG!

Quote:

Originally Posted by abhinav.gupta88 (Post 851244)

Diesel in dubai is sold at 4 dhms( 48 INR) while petrol is 1.5dhms(18 INR)

So I guess the increasing fuel prices and the increasing pollution will force govt to take such a step

there is a big subsidy on the sale of deisel. IMO ( no hard feelings for deisel-car users) , deisel should be priced more than the petrol giving an advantage to the people paying more for the fuel.

So I see that we have a model to follow. Seriously, unclean diesel consumer cars need to be phased out for a cleaner air. We do need to charge a premium like Dubai Govt. does. My vote go for taxing consumer diesel. It will no doubt help in long term, and lesser cars on streets do mean cleaner air and faster commute. This onus lies not only on govt. but on employers as well to ensure that lesser employees make it to office in their cars.

Even though all the tax money we pay does not translate to better amenities, it is a good start. i am in favour of heavy taxation and stringent laws against tax evasion.

HOWEVER, the tax rate should be fundamentally different. Both direct and indirect taxes. How can Premji and I pay same 30% income tax? I am sure everyone will scream at 50% income tax for Premji, so maybe all the high-end goods must be ridiculously taxed. Someone who builds a single-room house and massive mansion pay the same % of tax on the building materials. So use parameters like nature of goods, purpose of goods and quantity of goods for better taxation.

Better taxation will result in social development which will in turn cleanse the political system. Misuse of tax money is no excuse for tax avoidance. Things will improve with more computerization and RTI like legislation.

Quote:

Originally Posted by suvi (Post 851310)

Diesel and Petrol cost the same to refine. in fact in west, diesel is costlier sometimes. we subsidize diesel since it is used by Trucks and we want to keep Inflation under control.
I think Diesel cars must pay higher taxes at the time of registration to balance for the artificially lowered prices they pay at the pump. Selling prices at different prices for car and truck is not possible.

Even the petrol car buyers can do the same. Why paying bloody 46 Rs a litre in comparison to diesels 30 something when diesel refining costs more.

I think they wont mind paying a slight more tax if the petrol prices then could be reduced.

Quote:

Originally Posted by abhinav.gupta88 (Post 851762)

aree what did diesel lovers ever do to you yaar..
And
you do there is a big price difference between the petrol cars and the desiel ones..
So we did our home work and brought the diesel one for the long run money saver lol

Mods note: Use punctuation properly. Use upper case to start a sentence.

Here is what government said in yesterday's news paper. Indeed a good move in my opinion. cheers:

There have been a lot of unfriendly decisions in past which have paid off in long run, like retiring 15 year old commercial vehicals from Metro, moving public transport to CNG, etc & one more shouldn't hurt. I may sound like an activist, but at the risk of drawing ire of fellow bhpians, I support this move.

Times of India, Mumbai Edition, Page 21

Quote:

Should diesel’s price advantage be scrapped?

Pankaj Doval | TNN

New Delhi: Should private diesel cars be taxed more than the petrol cars so as to neutralize the subsidy they get on retail fuel prices?

Noted industrialist Vivek Bharatram has suggested that the excise duty levied on diesel cars should be more than that on petrol cars to reduce the rising popularity of diesel cars. The formula will also help the government offset the subsidy that private diesel car owners enjoy, though conceptually it is not meant for them. The auto industry, however, differs with the suggestion.

“It has obviously never been the intent of the government to subsidize diesel for use by private transport. However, diesel car owners benefit from the difference between the price of the petrol and diesel. This is in addition to the pollution diesel vehicles cause in metro towns,’’ Bharatram said in a letter to finance minister P Chidambaram.

He said the price differential between petrol and diesel at the retail level was leading to a surge in diesel cars. “As the differential keeps increasing, subsidy given to private diesel vehicles keeps increasing. It will also skew the sales more and more in favour of diesel cars, further increasing the government subsidies.’’

Originally kept low to benefit commercial vehicle operations like public transport vehicles and goods carriers that have a direct bearing on inflation, low diesel prices have led to increasing demand for vehicles running on the fuel.

Bharatram presented a “plausible argument’’ to neutralize the subsidy given to private cars. “You may consider the savings that every type of diesel car makes over a period of seven years, discount it and add it as an additional excise tax on diesel cars.

refining Diesel and petrol costs the same but output ratio of Diesel to petrol per barrel of Oil is less than 1. i.e. for the given volume of oil you get lesser diesel than petrol. This doesn't call for charging the Diesel more than petrol. If that was the logic then we would have had Tar (Final residue of refining process) being charged the highest.

Having said that, I do agree with the fact that diesel should not be subsidized. It is bad on the long run to subsidize anything. If you bring the price of diesel on par with petrol there would be incentive to create a better running trucks/commercial vehicles and will lead to lesser pollution and better utilization of Diesel. The Diesel guzzlers that we have today will immediately go off the road and we will have well maintained vehicles plying.

Quote:

Originally Posted by DieselFan (Post 852177)

Having said that, I do agree with the fact that diesel should not be subsidized. It is bad on the long run to subsidize anything. If you bring the price of diesel on par with petrol there would be incentive to create a better running trucks/commercial vehicles and will lead to lesser pollution and better utilization of Diesel. The Diesel guzzlers that we have today will immediately go off the road and we will have well maintained vehicles plying.

That's a god point, but that is not the intention of the govt. All govt wants to do is to keep the inflation down, as there are many state and the central elections coming soon.

Selling Diesel & petrol at par will no dobut bring the shutters down on diesel guzzlers. But it will result in a huge uproar. All the while, the Finance ministry is not moving an inch on duty cuts. It wants to meet it's target even if it means the Oil comps lose heavily and consumer has to pay higher. Wah what a policy clap: