Automobile sector | Govt not likely to hike cess on cars immediately

The government has no immediate plans to hike cess on cars, as per the media reports. During the festive season, there is a huge demand for automobiles and delay in implementing cess will relieve auto players. If government hikes the cess on automobiles then it may hurt the profitability of auto players in the country.
Earlier, August 30, the Union Cabinet had cleared an ordinance to hike cess on luxury cars and SUVs to 25% from the existing 15%.
The Indian luxury-car market, which was eyeing a double-digit growth, is likely to be hurt with the government implementing its decision to up the cess on luxury vehicles, believe industry experts.

BSE Auto index was trading down by 0.81% or 196 points at 23,951 level in line with the movement of the major indices in the market. Motherson Sumi, Tata Motors, MRF, M&M and Exide Industries were among the top losers on the index trading lower by more than 1%.
Meanwhile, Nifty was trading at 9,885 level, down by 89 points while Sensex was trading at 31,678 level, down by 213 points as of 1411 hours on Monday.


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