Maruti brand cars already levying the new price
Automobile: As more people look forward to buying new cars, the car price in the country is expected to increase anytime soon.
Following the withdrawal of excise duty concession on car manufacturers in India, car prices in India soared by four-to-six percent in December 2014.
Excise duty on small cars in India has been revised to 12 per cent from eight per cent earlier, while that of sports utility vehicles (SUV) has gone up from 24 per cent to 30 per cent.
However, the hike in the country would be slightly higher than in India, vehicle dealers say.
This was because the cost price for the dealer would increase and the latest tax of 55 percent (45 percent sales tax and 10 percent green tax) would be imposed on the new price.
For instance, In India Maruti Suzuki’s make alto 800 was around Rs 238,000 for the base variant. With 55 percent tax, it was sold at about Nu 370,000 in the country. Now, according to Indian media reports, Maruti Suzuki increased Alto’s price by Rs 8,500 for the base variant and Rs 12,000 for the highest variant.
This means that the new cost price for the base variant would be not less than Rs 246,500 and the selling price inclusive of taxes roughly comes to about Nu 382,000, an increase of at least Nu 12,000.
Prices of Maruti Suzuki cars in India increased between Rs 8,500 to Rs 32,000.
An official from Zimdra Automobiles said that they already received a notification from their principal correspondent saying that the new price would be applied.
The official said, those vehicles already in stock would be sold at the earlier prices but for those who already placed order, new prices would be levied. “We deeply regret the inconvenience, but this is something over which we have no control.”
Indian media reports also revealed that prices of Hyundai vehicles has gone up between Rs 15,000 and Rs 127,000 on account of the higher excise duty, increased cost of inputs and the currency fluctuations.
The retail price in India for the Hyundai Eon has gone up by Rs 15,400, for the i10 by Rs 21,500, and for the Santa Fe SUV by more than 120,000.
However, the general manager of Bhutan Hyundai motors said the company has not been notified but said a hike is expected sooner or later.
He said just recently, the price of i10 grand increased by Nu 2,000 to Nu 3,000 but this was due to increase in production cost. “If the excise duty is revised, prices of all the vehicles would go up,” he said.
Like wise, an official from Dejung Honda said the additional cost is beyond control. “Because the government will not refund the excise duty to us,” he said.
While it is definite the prices would go up, he said the manufacturer has not notified the local dealer. The new prices would be implemented as and when they receive the notification.
In India, Honda’s top selling car, Honda City has been revised by Rs 48,000 and Amaze by up to Rs 26,000.
Meanwhile, officials from the department of revenue and customs said they have nothing to do with the excise duty revision in India and that the dealers would be notified by the manufacturers.
Any increase in production cost, taxes and other factors such as transportation would increase the cost price which the manufacturers usually pass on to buyers.
By Tshering Dorji