Haryana cuts CST on Maruti cars from Nov 01, 2008

In a move that could boost the sales of the country’s largest passenger carmaker, the Haryana cabinet on 21st October’08, has reduced Central Sales Tax (CST) on inter-state sale of Maruti cars and vehicles from two per cent to one per cent. At a meeting here chaired by Haryana chief minister Bhupinder Singh Hooda, the cabinet decided to reduce the tax from Nov 1, 2008. The move comes after the chief minister of the state had a conclave with S. Nakanishi, managing director of MSIL and a host of other luminaries earlier. It is widely believed that the cabinet observed that the association of MUL with Haryana is historic and has definitely put the state on the global map of the auto manufacturing industry. Also, it has made massive expansion in Haryana.

Now, all vehicles rolled out by Maruti from its two manufacturing units (Gurgaon and Manesar) are expected to be cheaper at the dealer’s end due to just one per cent CST on inter-state sale of its products. With this reduction in tax, buyers of Maruti cars would benefit to the tune of Rs. 1.4 billion (Rs.140 crore) for the remaining period of the current financial year. This benefit would be Rs.2 billion (Rs.200 crore) a year for the subsequent years.Maruti was always entitled to a 1 per cent rebate on CST by the state government before and the reduction was very much on the anvil due to the 1 per cent reduction in CST from 3 to 2 per cent in this year’s budget.

Source: ET

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