The auto industry, which has been reeling under a slowdown of sales, is crying for excise relief in the Budget 2008-09 and have sought Finance Minister P Chidambaram’s intervention in making loans both cheaper and easier. Industry leaders want further cut in interest rates to get them out of an impending recession. Auto majors want the excise duty differential to be eliminated in the budget. Saying that the cost of credit verification was phenomenally high, they suggested that the credit verification bureau should be operationalised as early as possible.

“Reduction or making excise duty uniform is a must. We also look at some intention of a reduction in Central Sales Tax (CST) and rolling out Goods and Services Tax (GST),” said Society of Indian Automobile Manufacturers’ (SIAM) Director General Dilip Chenoy.

Two years ago, the Finance Minister had cut the excise tax on small cars by a third to 16 per cent while for larger cars it remained at 24 per cent. Mr Chenoy, however, added that on the taxation front the industry did not see much possibility of concerns being addressed. “The excise duty structure is not clear, we are not sure if the government will do anything now or wait towards implementing GST.”

Similar views were echoed by GM India Vice-President P Balendran, as he called for a reduction in excise duty and early introduction of GST and phasing out CST. “We want a uniform policy in excise tax. We do not agree the differential tax structure. Let customers decide the product they want to buy,” said Ford India’s VP Sales Marketing Scott McCormack.

“However, with the framework for credit information bureau in place the banks ability to gain information on potential loan seekers will dramatically increase...not immediately since you still have to set up the bureau. This is a long time solution for the sector’’ said Mr Chenoy.

Mr Chenoy said the industry would like to have an eight per cent reduction in the excise duty on buses as a measure to improve public transportation in the country and tax cuts for import of hybrid vehicles.

BUDGET WISHLIST

Ram N Agarwal
CEO & MD,WeP Peripherals

*The current duty structure on the PC & IT hardware sector ensure there is growing interest in investing in Indian hardware manufacturing industry. We should help those investors who are sitting on the sidelines by creating a stable duty regime.

*There are some distortions due to implementation of MRP based regime. You need to increase the abatement rate to reflect the ground realities.

*Providing purchase preference to locally manufactured product to boost local manufacturing.

*Provide impetus to innovative products made for India & made in India as per R&D policy.

*Give public-private parntership package to polytechnics.