In the recent budget, the excise duty on vehicles was increased,i.e for small cars it was increased to 12% from 10% and for petrol cars with engine capacity under 1200cc and for diesel cars of engine capacity under 1500 the excise duty was increased from 22% to 24%. The duty was much more in case of petrol cars with capacity greater than 1200 cc and diesel cars with capacity greater than 1500 cc where it was increased to 27% from 22% with fixed duty of Rs 1500. SIAM, due to drop in sales by 19% has asked government to cut down the excise duty which was increased in this budget. The sales of vehicles, especially have not even stabilized during the festive season. What do you think is the attributable cause for this situation?
