The prices of small cars are expected to increase by around Rs 13,000 to Rs 20,000, whereas mid-luxury passenger cars are expected to cost an additional Rs 25,000 to Rs 50,000, with the increase in the sales tax on passenger cars from 6 per cent to 12 per cent.
While Honda Siel Cars India Ltd (HSCIL) gave out the exact increase in the prices of the four versions of Honda City, most other manufacturers only gave an approximate indication to the kind of price impact the sales tax ruling will have on the prices of their cars. According to Jagdish Khattar, managing director, Maruti Udyog Ltd, "the taxation on passenger cars is already very high. And with the increase in sales tax, the demand for passenger cars will certainly come down."
Khattar said the price of Maruti 800 will increase by around Rs 13,000 to Rs 17,000, depending on the version, whereas the prices of Maruti Zen should go up by around Rs 20,000 to Rs 26,000.
An official of Hyundai said the price increase in the case of Santro will be of the order of Rs 18,000, whereas the price of Accent -- its mid-luxury car -- should increase by approximately Rs 36,000 in Delhi.