Toyota won't scale up India operations due to high taxes

“We won’t exit India, but we won’t scale up.”

Shekar Viswanathan - Vice Chairman, Toyota Kirloskar Motor, has stated that the company won't scale up its operations in India due to the government's high tax regime.

The taxes on cars and 2-wheelers are so high that companies are finding it difficult to expand. Many potential customers find it difficult to own a car and as a result, there is lower demand and factories are lying idle. This also means that fewer jobs are created.

Viswanathan further clarified that Toyota has no plans to exit the Indian market due to the higher taxes.

As per the current tax structure, the government levies up to 28% tax on motor vehicles. Based on the car's type, length or engine size, the government charges an additional 1-22% tax. The taxes on electric vehicles are currently 5%, which the government might raise once sales increase.

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