Auto excise duties to match China levels

New Delhi, March 21 | Updated: Mar 22 2006, 05:30am hrs
The 8% excise duty cut for small cars may only be the first step in making India a small car manufacturing hub. A senior official in the heavy industry ministry on Tuesday indicated that the taskforce drawing up the auto industry vision document wants further re-orientation in duty levels to match tariff levels in South-east Asia and China. The excise duty on small cars in China is just 1-2%.

This is one of the key demands to make the domestic industry competitive in the global scenario. Of course, tax changes cannot be made in a single stroke since (the governments) revenue considerations have to be studied, the official said. The idea is to lay down a roadmap for providing a level-playing field to the Indian auto industry, with a thrust on creation of manufacturing infrastructure and right taxation, he added.

The five subgroups, which had been constituted under the taskforce to address a horde of issues like demand generation, environmental

and safety regulation etc, have already submitted a working document to the ministry.