Financial Daily from THE HINDU group of publications
Saturday, Jan 11, 2003
Financial Daily from THE HINDU group of publications Saturday, Jan 11, 2003 |
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Industry & Economy
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Excise and Customs Auto dealers moot 14% excise on cars, MUVs Our Bureau
CHENNAI, Jan. 10 THE Federation of Automobile Dealers' Associations (FADA) has suggested that a standard excise duty of 14 per cent should be levied on passenger cars and multi-utility vehicles. Mr Ajit Kumar Chordia, President, FADA, said in a memorandum to the Government that though the Kelkar Committee has recommended that the excise duty on passenger cars be brought down to 20 per cent over a period of three years, these small doses of reduction in excise duty will not have the desired effect of stimulating the growth of passenger car sales. He said that the passenger car industry has been the key driver of growth in a number of countries and cannot be treated as non-merit goods, particularly in the absence of a reliable public transport system in many parts of the country. He said that the depreciation allowance on new commercial vehicles should be increased to 33 per cent as the product cycle is becoming shorter and the used vehicle prices have crashed. Mr Chordia said that as recommended by the Kelkar Committee, uniform VAT at the State level not exceeding 10 per cent with a provision for set-off of all taxes including the tax charged by the exporting State on inter-State movement of goods, should be introduced at the State level with effect from April 1 and all other taxes discontinued. Appropriate measures, he said, should be taken to bring in uniformity in road tax on vehicles which vary substantially from State to State leading to undue diversion of trade from one state to another. Mr Chordia said that thrust must be given to the development of urban and intra-city roads and parking infrastructure. The construction and operation of multi-layer parking facilities must be accorded the status of infrastructure project under section 80(1)(A) of the Income-Tax Act.
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