Excise duty structure retained till end of calendar

Government has announced it will not change the excise duty structure for cars till the end of the year. A lower excise duty structure was put in place by the previous government to help push up sales and get the Indian car market back up to speed.

So far, the revision in excise duty hasn't yielded the sort of results car makers were expecting, but there is certainly an upward trend in buying decisions. What has also helped this trend is the introduction of new models.

The excise duty structure will now come up for revision in December 2014, but by then, car makers believe revival of the market would have begun. Two factors are likely to contribute to this with the first being continued introduction of new models from various car makers and the other being the introduction of the scrappage policy.

There's no announcement on the scrappage policy yet, but car makers have been pushing for it and hope a step in this direction would be taken during the announcement of the budget. The scrappage policy will ensure cars that are over 15 years don't ply on the roads. Pulling these cars off the road would mean fresh demand and with it a rise in sales.