Buy that big car: SUVs, petrol trucks to cost less

LUXURY ON WHEELS: Your big dream car is slightly cheaper thanks to tax cut.

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New Delhi: Cars with engine capacities of 2,000cc and above will become cheaper after the government announced it was reducing additional excise duty on the vehicles by Rs 5,000 per unit.

The Union Budget also cut the duty on petrol-driven trucks to eight per cent from 20 per cent. "In (the) case of vehicles of engine capacity below 2000cc, this component (specific duty) was Rs 15,000 per unit, while for vehicles of (a) higher engine capacity it was Rs 20,000 per unit. These rates are now being unified at the

lower level of Rs 15,000 per unit," Finance Minister Pranab

Mukherjee said while presenting the Budget for 2009-10 today.

Excise duty on petrol-driven trucks and lorries has also been reduced to eight per cent from 20 per cent.

"Petrol-driven trucks provide a useful means of transport within cities and across short distances. These are chargeable to excise duty of 20 per cent. I propose to reduce excise duty on these trucks to eight per cent to equate the duty with similar vehicles run on diesel," Mukherjee said.

Besides, the duties on the chassis of such trucks and lorries have been reduced to eight per cent from 20 per cent, although the fixed component of Rs 10,000 would continue to be levied.

Aiming to reduce the usage of fuel guzzlers, the government had last year imposed the fixed excise duties of Rs 15,000 for cars with an engine capacity of 1,500cc-1,999cc and Rs 20,000 for engines with 2,000cc and above. This was in addition to the already existed 20 per cent duty on such cars.