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Budget 2012: Cars To Cost 2% More; Mercedes Disappointed By Budget

Pranab Mukherjee after presenting the financial budget 2012 gave a blow to the sentiments of the car buyers. The excise duty on cars getting higher by 2%. The increased excise duty is going to be levied on the cars from tonight.

Mercedes Benz India Logo

Mercedes Benz India

The excise duty on the large cars has become 24% from 22%. But there is news to relax that finance minister have not levied any additional tax on the diesel cars. Car manufacturers are already suffering the injury of fuel price hike and higher interest rates. The sales of the passenger vehicles went high up by 2.95% from April to February this year, after a heady growth of 29% in 2010-11.

The experts are saying that the increase in price of the cars will affect its sales a lot. The hike in price will also affect the two-wheeler and trucks’ industry. After this, the share price of Maruti returned to green position, the share price of Maruti went high by 0.26%.

On the other hand, Mercedes Benz India announced that they are going to increase prices of their cars by Rs. 3 lakhs due to hike in the excise duties on cars. “The Financial Budget of 2012 is very disappointing for us. We were hoping for some relaxation in taxes for large and sophisticated vehicles instead of hiking it further,” Mercedes Benz India Director (Corporate Affairs and HR) Suhas Kadlaskar told the media.

Mukherjee also increased the excise duties on the petrol cars below1200 cc engine and the diesel cars below 1500 cc engines. Society of Indian Automobile Manufacturers (SIAM) are welcoming this step of finance minister in open arms.

sources: 1, 2

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