Cars are more taxed than cigarettes: Honda Cars

In a recent statement Honda Cars India Ltd (HCIL) said there is a high incidence of taxes on automobile sector rather than on cigarettes in India. The Japanese carmaker stated that cars are being considered as luxury brand and are heavily taxed in the country than cigarettes which are harmful.

During an interactive session with the media, Jnaneswar Sen, Senior Vice-President, Marketing and Sales, Honda Cars India, said, once a car leaves factory after production it is subjected to various taxes including excise duty, CST, calamity tax, education cess, VAT and road tax. He also drew attention to the fact that the tax rates vary in different parts of the country and there is no uniformity in it. Sen also shed light on the issue of road taxation. He stated that there are fluctuations in the road tax which is four per cent at one place and 16 per cent at the other.

Sen also raised concerns over the diesel issues where there is no clarity on the subsidy given by the government. He pointed out that while most of the companies have invested on diesel powered cars a shift back to petrol would mean restructuring the complete alignment leading to losses. The indecisive attitude of the government has added to the woes of several manufacturers who are refraining from investing in diesel technologies thus delaying their diesel powered car projects.

Sen further added that the car market is facing a lull phase and only a stable government could bring stability in the taxation policies.