[avishar]

Cant really understand what is he complaining against,big suvs that are heavy and guzzl more fuel or that its wrong to give subsidized diesel to the rich.If he does not want the latter to happen then why just target suvs.Any high end diesel car an eclass or s class also then uses subsidised diesel.

[Aroy]

Originally Posted by apachelongbow

World over its an accepted fact that SUV/UV/SUT's constitute about 40% of all passenger cars sold. In India this figure is about 20% today. Also one person driving a 7 seater SUV is generating an awfully big carbon footprint, not to mention space wastage on our city roads. Now if considering the minister's argument, we impose a 'pollution/luxury' tax on all large SUV's, we can hopefully restrict the suv usage to below 20% of all passenger car's sold, and promote a more rational utilization of our resources.
I do not mean to offend any SUV lovers/owners here, just logically trying to analyze the minister's comments.

I beg to differ. Assuming that MUL and Hyundai have minuscule SUV sales and Toyota, Tata, Mahindra and a few others have majority sales of SUV/MUV we are pitting nearly 15 lacs against a lac at the most.

Another way of looking at it is that 20% SUV/MUV means every fifth vehicle is SUV/MUV. Even in rural India that is hard to come by.

I would say that the proportion of SUV/MUV is around 5% of which majority are "people movers" and not SUV.

What people tend to forget is that modern SUV has at par or better fuel consumption compared to the older generation vehicles. Add to that indifferent maintenance and you realise that a modern diesel SUV is way ahead (in terms of lower pollution) of that old rickety car my neighbour has been hanging on for last fifteen years.

The funny part is that BMW and Mercedes have some of the most efficient, advance and low polluting diesels in India.

[Brocklock]

Originally Posted by sgiitk

I suggest that the minister drives Kanpur-Unnao (20km) on NH25 (the first section on the GQ to be taken up was NH25 - Lucknow to Kanpur) and he will know why SUVs are necessary.

Alternatively, though not such a high profile road yesterday it took me almost three and a half hours on NH92 (Etawah-Gwalior) on the less than 45km between Bhind and Gohad. This road is also under NHAI.

I am a regular on both. A double whammy within 24 hours of each other were enough. I am regretting NOT buying an SUV! Roads are getting really bad. Both were decent roads till a couple of years ago.

Mr Minister, your colleague Mr Kamal Nath makes it necessary to get an SUV even for major roads, else we will have to ride (probably better) tractors. If you want us to refrain from SUVs FIX the roads.

I agree. Fix the roads and make is it a little safer to go around in a car. I am regretting NOT buying an SUV too.

For a country where the road conditions are proboably the WORST and the most UNSAFE in the civilised world, the hon. minister sure sounds like one to talk!

[vb-saan]

Just read through minister's comments. And partially agree with that. The amusing part is targetting BMWs and Audi. These premium cars are so strict on emission norms and always innovate on cleaner diesel engines. If SUVs are targeted, more appropriate references should be those Sumos and similar vehicles around.

I do agree with his thoughts about diesel subsidy. Maybe it is time to look at some different options as well. I guess in UK, road taxes are linked to the carbon emissions, less clean more tax for the model. And here in Singapore it is an entirely different approach. Almost 99% of the car makers don’t have a diesel model in their portfolio. And the reason is the high road tax for diesel cars – almost 4 times than an equivalent petrol model. Hence diesels are only for heavy vehicles and taxis.

[akj53]

There are 2 points to be considered.

1. Diesel is subsidised in India but subsidy is not meant for cars (even small cars). So Government should levy 1 time subsidy surcharge at the time of purchase of vehicle. This should be calculated to the extent of the amount of subsidy, by which that vehicle would have benefited, in running for say 1 lac kilometers. This should be fixed by Government for every vehicle with different engine variants, as per their real life average fuel consumption. This surcharge should be collected with excise duty from the manufacturer.

2. All larger cars including SUV's consume more fuel per passenger per km due to their weight. Simultaneously all vehicles with more powerful engines consume more fuel per per passenger per km., even when they are not using their full power. Most large vehicles are driven by only the driver or with one passenger, most of the time, thereby further increasing the fuel consumption per passenger. Now as concerns like global warming and fast depleting fuel reserves have become critical issues, excessive and wasteful fuel consumption must be curbed with a heavy hand. So all vehicles (both petrol and diesel) should be taxed based on their per passenger / per kilometer consumption to discourage use of fuel guzzlers.

Also the large vehicles hog more road and parking space which should also be discouraged due to chaos prevailing in our congested roads and cities. So vehicles should also be taxed as per their size.

The minister should have not targeted any particluar brand but his thinking is right. Any talk of going back to protectionist days or bullock cart times is not justified as we must think keeping in view the current conditions.

[Yeldo]

@akj53:

Oh, so I get the benefit of cheap Diesel when I buy onions (the truck that brings it gets the subsidy), but am not entitled for similar subsidy when I take myself to the hospital?

The "tax - per- passenger" policy was in vogue in many states till recently. But the "per passenger / per kilometer consumption" suggestion is something novel. Appears to be a clever suggestion to solve this issue.

[akj53]

@Yeldo

Thank you for liking my pppkc (per person / per km consumption) suggestion.

Subsidy burden is borne by the entire nation. It is the favourite tool of politicians to appease or benefit a set of people by robbing rest of the nation. Most of the subsidies provided by the government fall under this category.

No offence meant brother, but government provides subsidised healthcare for everybody in government hospitals but why it should be provided for going to hospital (may be private or even corporate hospital) in a car.

Government should also levy one time tax on vehicles of all types based on their CO2 and other emissions to control pollution.

[Aroy]

I think that the idea of loading the diesel passenger vehicles with a one time tax is a dangerous suggestion. In the hands of politicians it can boomerang on us poor commuters. Look what they have done with the fuel surcharge. It was meant to upgrade the road network, so we were mollified. But then the huge amount collected; around 20K crores annually; just goes to the general fund, and we are left holding the bill in terms of new road projects which collect toll!

As stated a number of times in this thread, the subsidy on diesel is notional, as it means less tax is collected from diesel compared to petrol. Further newer models of diesel vehicles are more efficient than the older ones, hence we should discourage older vehicles using fiscal means; tax older vehicle more; as is done in Europe, rather than fiddle with fuel pricing.

[carboy]

Originally Posted by Aroy

As stated a number of times in this thread, the subsidy on diesel is notional, as it means less tax is collected from diesel compared to petrol. Further newer models of diesel vehicles are more efficient than the older ones, hence we should discourage older vehicles using fiscal means; tax older vehicle more; as is done in Europe, rather than fiddle with fuel pricing.

So why do you think diesel deserves less tax as compared to petrol? Especially such a huge difference.

[sgiitk]

Somehow, of late Mr Ramesh reminds me of Don Quixote!

I think some commission (Kirit ??!, I forget which) had suggested a Rs.80,000 one time tax on diesel vehicles. What about poor Honda who got crucified by Mr Ramesh without a single diesel vehicle in their lineup?

[Aroy]

Originally Posted by carboy

So why do you think diesel deserves less tax as compared to petrol? Especially such a huge difference.

I do not think that diesel should be taxed less, but the Government thinks so, as it would appease the masses!

As subsidies ultimately boomerang, and its benefits are rarely reaped by their target audience, I am not in favour of any form of subsidies.

[aargee]

Originally Posted by sgiitk

Somehow, of late Mr Ramesh reminds me of Don Quixote!

Lol - wonderful comment ; but please sir, do not insult Don Quixote

On a serious tone, the minister got a good beatings from the German ambassador & that should put him off for sometime now. Now, whoever made such a speech is probably looking for a location change, poor guy!!!

Instead of simply giving unnecessary baashans (and taking the beatings later), they could've worked out a strategy for dual Diesel pricing or increase the import duty triple fold for such large Diesel SUV's or some means to handle the situation.

[carboy]

Originally Posted by Aroy

I do not think that diesel should be taxed less, but the Government thinks so, as it would appease the masses!

As subsidies ultimately boomerang, and its benefits are rarely reaped by their target audience, I am not in favour of any form of subsidies.

Me neither - but since it seems very difficult to remove the diesel subsidy, won't it be better to have a compensating Diesel Tax on Diesel Passenger Vehicles which will indirectly reduce the subsidy?

[asdon]

latest remark from Ramesh -
"[COLOR=#800080]SUV owners should pay full market price of diesel: Jairam Ramesh[/COLOR]"

posted in TOI website. BTW I was checking few documents in some govt websites recently and then came accross one news scroll bar in NDTV profit day before yesterday, which showd Diesel market price is less by Rs 2.34 /- from its actual price. If that is true why they are giving this discount, who can buy it at 42 can also buy it at 45.

[avishar]

@asdon The reason why the government subsidies diesel is because diesel is used for a variety of purpose.Not only for private cars,but factories,buses,trucks,agricultural water pumps,generators and so on.If they suddenly hiked diesel prices it will cause a domino effect on commodity prices raising inflation which is already high.
Rural india uses a lot of diesel for tractors and all and would not be able to pay up higher prices so easily.