It seems like a taxing year for the Indian car market, the auto bazaar that was not yet fully recovered from the wounds of increased excise duty, is going to have fresh bruises from the Maharashtra government, who has announced to increase 2% tax on petrol-powered cars and 4% on diesel-powered cars. However, the tax rate on CNG powered cars is lowered down by 2%. The increased duty will further slow down the snail pace growth of Indian auto market.
The increased rates will result into a dent in your pockets and the manufacturers do not have to increase their prices as the additional duty is levied post ex-showroom price of the vehicle. Maharashtra is a home for a lot of manufacturers and accounts for a huge slice of the sales cake, also near about 50% Maharashtra sales comes from Mumbai only. Maharashtra seems to have just joined to bandwagon as states like Karnataka and Andhra Pradesh already working on increased duty, because of which the cars are pricier in these regions. Other states might follow suit in order to unburden themselves from the fiscal weight.