The New GST Raised the Cost of Millat Tractors
The current fiscal budget for 2024-25 has introduced many changes and the major changes are observed in the auto industry. Among the changes that have been made includes the adjustment of the tax scale on the imported used vehicles and manufactured used vehicles. Even the agricultural tractors have not gone unscathed by these adjustments.
also read: Millat Tractors Will Export Almost 3000 Units This Year
To this, Millat Tractors limbered up by saying they were to effect an increase in the price of their tractors due to a 10% increase in the GST and an increase in the cost of production. Based on the information they provided, new price increases for MF tractors are implemented for tractors that have been ordered from the first of July, 2024. This was further elaborated that the order booked with Millat Tractors till June 30, 2024 for which financial instrument dated on or before June 30, 2024 is received latest by July 09, 2024 will be on the earlier rates.
New Regulatory Tax and Its Effects
Also in the recent times the concept of new regulatory duty (RD) has been imposed on the imported used vehicle having engine specification of 1300 cc to 1800 cc which is generally 15% RD. Motor vehicles with an engine capacity of more than 1800cc attracts higher RD of between 70-90%. However, cars with engine capacity below 1300cc will remain free from this duty as are maintained at the current tax bracket under the Daihatsu Mira and Toyota Vitz marques. These may help small cars but as for local manufacturers like Pak Suzuki, which deals in models such as Alto, WagonR, Cultus, Swift, all of which are above 1000cc, this poses a problem.
It is projected to have the strongest effect on used HEVs with more than 1,300cc, including the Vezel, Corolla Cross HEV, and more. These vehicles could soon face an increment in their price by Rs. 2. 5 million to Rs. 3 million while eradicating their market value from Rs. 7. 5 million to Rs. 9. 5 million.
Altogether, all these fiscal shifts are in the process of reconstructing the automotive market environment and may have shown the necessity for readjustments from manufacturers and will possibly impact consumers’ decisions in the next fisc-al year.
