The Indian budget 2023 has had a significant impact on the prices of cars in the country. The budget, which was presented by the Finance Minister Nirmala Sitharaman on February 1st, 2023, has proposed several changes that are expected to affect the automobile industry.
One of the major proposals in the budget is an increase in customs duty on completely built unit (CBU) cars and SUVs. The customs duty has been increased from 20% to 30%, which is expected to lead to an increase in the prices of imported cars and SUVs in India. This increase in customs duty is expected to provide a boost to the local automobile industry, as it will make imported cars more expensive and less attractive to buyers, thereby encouraging them to opt for locally manufactured vehicles.
The budget has also proposed an increase in the excise duty on petrol and diesel vehicles. The excise duty on small petrol and diesel vehicles has been increased from 12.5% to 15%, while the excise duty on larger vehicles has been increased from 20% to 22%. This increase in excise duty is expected to result in a price hike for cars and other vehicles that run on petrol and diesel.
In addition to the increase in customs and excise duties, the budget has also proposed a hike in the insurance premium for cars. The insurance premium for cars with a capacity of up to 1,500 cc has been increased from ₹1,500 to ₹2,500, while the insurance premium for cars with a capacity of over 1,500 cc has been increased from ₹2,000 to ₹3,000. This increase in insurance premium is expected to lead to a rise in the overall cost of owning a car in India.
Despite these hikes, the budget has also proposed several measures to provide relief to the automobile industry. The government has announced plans to set up a National Technical Textiles Mission, which will provide support to the automobile sector by promoting the use of technical textiles in the manufacturing of vehicles.
In conclusion, the Indian budget 2023 has had a mixed impact on the prices of cars in the country. While the increase in customs and excise duties and insurance premium is expected to lead to a rise in the prices of cars, the measures proposed to support the automobile industry are expected to provide some relief to the sector.
