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Excise Duty On Diesel Cars Under Reconsideration

Perhaps, the situation has come back to square one. It had just been a month, that we could breathe some fresh air, away from the fuel price and duty hike. Speculations on increase in excise duty on diesel vehicles has almost settled with the dust. But, the Government, known for giving us shocks, has yet again come up with a fresh news on excise duty on vehicles. The parliament has now been informed that the Government is examining the proposals to increase the duty on diesel cars more closely. The representations for the same have been received by the Government which will be scrutinized and examined by the supreme authority.

It was just a month back when the automakers were requested to provide their inputs on the hike in duties. Most of the companies were indeed against it as this year due to petrol price hike, the car sales showed a slope downwards. Car makers were banking on the demand that got generated for diesel cars due to the cheaper fuel. But once again, the situation turned messy when the Government proposed to hike the duty on diesel cars. Later, the news did come that this action will not be taken up, which gave relief to a lot of stakeholders.

However, the situation has again come to the point where the hike looks inevitable this time. The justification this time for the hike is that the diesel cars are more polluting, thus causing hazard to the environment. On top of that, these vehicles run on the subsidized fuel, thus providing unintended benefit to diesel car users. Well, whatever may be the reason, a hike in excise duty on diesel vehicles will further bring down the sales numbers in the automobile sector. Will a concrete decision will be taken atleast this time? Let’s wait and watch.

Source – Economic Times

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