Friday, February 26, 2010

Car Price will go up in India after Budget 2010 Announcement

Earlier today, Indian finance minister announced the Union budget in parliament. He tried to present a balance budget. The finance minister announced that people will have to pay less income tax and this will be welcomed by the consumers in general. However, he also announced that excise duty will be increased to 10%. The current rate of excise duty is 8% and as a result of this increase, the price of cars will increase. In fact, companies like Hundai and Maruti have already announced that the price of their cars is going to increase because of this announcement from the finance minister. Toyota has also said the same thing.
I have mix feeling about this matter. In India, a car is still consider to be a luxury item by most people as the country has just around $1000 dollar per capital income. On the other hand, Indian economy is growing and there is flourishing middle class. Many families really need a car for their jobs and education.