Auto News

Car Manufacturers Seek Government Help

By Motortrend India Staff   |   30 August,2009

The Indian car industry is seeking help from the Central government to continue with the lower manufacturing tax regime to ensure robust recovery and make it globally competitive.


The new President of Society of Indian Automobile Manufacturers (SIAM) Pawan Goenka said that the India automobile industry requires support from the government to maintain the steady growth in sales achieved in passenger vehicles and two-wheelers so far. The sales of commercial vehicles too shot up. He also feels that if the Cenvat rate is reversed, it would be a big blow for the automobile industry. “Just because we managed to reverse the trend, there is no reason for taking back what helped reverse it,” Pawan Goenka added. He believes that going back to the previous excise duty rates is unreasonable.


In the new tax regime, excise duty on small cars has come down to 8% while big cars and SUVs attract a 20% duty, plus an additional Rs 15,000 duty on engines above 1500cc and Rs 20,000 on those above 2000cc.


Goenka said the government stimulus packages, and a series of other measures, were responsible for the turnaround in the Indian car industry which is one of the few markets globally to witness positive numbers. He listed the gradual lowering of interest rates, decreased commodity prices and a general economic recovery among factors pushing growth. “It is the right balance and needs to be maintained,” Goenka said.



Related Content