The latest federal budget has introduced new vehicle taxes, resulting in substantial price hikes for locally manufactured cars across different categories. Here’s how the new withholding tax rates have affected various vehicle types:
- Cars up to 850 cc, such as the Alto VXR, now face a tax of 0.50% of the price, amounting to Rs 12,500, up from Rs 10,000 previously.
- Vehicles ranging from 851 cc to 1,000 cc will be taxed at 1% of the price, resulting in Rs 38,580 compared to the earlier Rs 20,000.
- Cars between 1001 cc and 1300 cc now incur a 1.50% tax, totaling Rs 56,985, increased from Rs 25,000.
- Vehicles in the 1301 cc to 1600 cc range are subject to a 2% tax, now Rs 81,585, up from Rs 50,000. This means models like the Honda City will cost an additional Rs 31,000.
- For cars from 1601 cc to 1800 cc, the tax rate has risen to 3%, amounting to Rs 225,270, compared to the previous Rs 150,000, increasing the price of vehicles like the Toyota Grandi by Rs 75,000.
- Vehicles from 1801 cc to 2000 cc now face an increased tax rate, resulting in Rs 100,720, while those over 3000 cc have seen their tax rise to Rs 1,139,880.
MG has adjusted its prices accordingly under the new tax regime. For example, the price of the MGHS Essence has increased from Rs 8,499,000 to Rs 9,800,000.
These tax hikes are anticipated to have a significant impact on the automobile market, leading to higher costs for consumers across various vehicle segments.
