The federal government announced new vehicle taxes in the last budget, leading to a significant increase in the prices of locally produced cars. The new withholding tax rates have affected different categories of vehicles.
For cars up to 850cc, including the Alto VXR, the tax is now 0.50% of the price, which comes to Rs 12,500, up from Rs 10,000 earlier. Vehicles between 851 cc and 1,000 cc will be taxed at 1% of the price, bringing it to Rs 38,580 compared to Rs 20,000 earlier.
Cars in the 1001cc to 1300cc range will have a tax of 1.50%, which equates to Rs 56,985, up from Rs 25,000. For vehicles from 1301 cc to 1600 cc, the tax is 2% of the price, now Rs 81,585, up from Rs 50,000. This means the Honda City will cost an extra Rs 31,000.
For vehicles between 1601cc and 1800cc, the tax has increased to 3%, or Rs 225,270, up from Rs 150,000 previously, making the Toyota Grandi R75,000 more expensive. Cars from 1801 cc to 2000 cc now face a tax hike of Rs 100,720, while vehicles above 3,000 cc have se7242en a tax hike of Rs 1,139,880.
In addition, MG adjusted its prices according to the new tax regime. Price of MGHS Essence, earlier Rs 8,499,000, has now increased to Rs 9,800,000.
These tax hikes are expected to significantly impact the automobile market and increase vehicle costs for consumers across segments.
