Recently, German luxury automobile manufacturer Audi has expressed disappointment over high taxes in India. According to Audi, high taxes in India is the reason preventing people from owning luxury automobiles. To statistically support the statement made by Audi, luxury cars only account for 2% of the total sales of passenger cars in India annually. On top of it, the percentage sales have been more or less the same in the past decade.
Audi India head Balbir Singh Dhillon has put forward Audi’s request for tax relaxation in front of the Indian government. According to him, luxury cars attract 28% GST. On top of that, there’s a 20 or 22% less depending on the type of the car. This raises the taxation amount to a whopping 50%. He further emphasized the fact that this demotivates people to own luxury items, let alone cars.
Not only that, but Dhillon also counted additional costs of luxury car ownership. Noteworthy of them were rising fuel prices and high registration prices in certain states. He further noted that India’s a young country. This young country is driven by many aspirations, owning luxury being one of them. However, current taxation policies don’t seem very supportive of their aspirations.
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Dhillon also pointed towards the underlying benefit of the Indian government. “If more luxury items are sold, the government would eventually also get more tax”, Dhillon said. Dhillon closed off the media interaction with a discussion on the EV sector. He gave lower GST rates of 5% and support from several state governments the credit for benefitting the electric car sector. He also added that Audi needed to earn some profits before investing further in India. It is to be seen what decision the Indian government makes regarding this matter.
