Income Tax Rates Should Increase Consumption: Automobile Industry Praises Union Budget 2023

The automobile industry on Wednesday termed the Budget for 2023-24 as growth-oriented, saying the proposed measures will drive sustainable yet inclusive growth at a rapid pace..Automobile industry body Society of Indian Automobile Manufacturers President Vinod Aggarwal said a 33 per cent increase in capital outlay with an effective provision of Rs 13.7 lakh crore will spur growth in the economy, resulting in a positive impact on the domestic automobile industry.."Another appreciable feature of the budget is putting more money in the hands of the individuals by lowering effective personal income tax rates that should increase consumption and consequently lead to more demand," he added..All in all, this is a growth-oriented budget with a positive impact on the auto sector, Vinod Aggarwal said..Automotive Component Manufacturers Association President Sunjay J Kapur said the budget is a blueprint of a digitally enabled Aatmanirbhar Bharat, coupled with measures that will drive sustainable yet inclusive growth at a rapid pace.."Focus on exports, manufacturing, local value addition and encouraging green energy and mobility are indeed steps in the right direction. Further, the proposals for personal Income Tax will put more money in the hands of people thus fuelling consumption, leading to economic growth," he added..Automobile dealers' body FADA President Manish Raj Singhania said the capital outlay of Rs 10 lakh crore in infrastructure spending will aid CV sales. Apart from this, the reduction in individual tax slabs will benefit the ailing entry-level two-wheeler and passenger vehicle segment..Society of Manufacturers of Electric Vehicles Director General Sohinder Gill said that after passing through a difficult period of lack of good quality "Made in India" EV components for the last 2 years, the local supply chains are beginning to take shape and the increase in customs duty on SKD/CBU is therefore timely as it will further incentivise the local suppliers because of the relative price advantage..Finance Minister Nirmala Sitharaman has proposed to further provide impetus to green mobility.."Customs duty exemption is being extended to import of capital goods and machinery required for the manufacture of lithium-ion cells for batteries used in electric vehicles," she stated.."There are still many parts of EV componentry such as lithium cells, permanent magnets for electric motors, semiconductors etc that will need to be imported and we expect rationalisation of customs duty on such essential imports will help keep the EV prices in check," Gill said..The continuation of the customs duty-free status for machinery used to produce lithium-ion batteries could result in some stabilisation in battery pricing, he added..Maruti Suzuki India Chairman RC Bhargava said the government over the years has tried to improve the ease of doing business while enhancing spending on infrastructure creation..Despite it being the last Budget before the elections next year, the government has stayed away from populist measures and presented a growth-oriented budget, he added..TVS Motor Company MD Sudarshan Venu termed the budget as well-rounded.."The emphasis on increased infrastructure spending and support for lithium-ion battery manufacturing will be a great multiplier for the industry overall," he noted..Hero Electric Managing Director Naveen Munjal said the Budget reflects the government's inclination to support the EV transition, enabling the creation of a carbon-free nation that thrives on sustainable, futuristic and alternative fuel technology..Ashok Leyland Executive Chairman Dheeraj Hinduja said the road transportation sector plays an important role in national development and would have an even more impactful role, going forward, in supporting the government's vision..The announcement that old vehicles owned by the central government and state governments will be replaced as part of the vehicle scrapping policy presents a significant opportunity for fleet modernisation, he added..Toyota Kirloskar Motor Country Head and Executive Vice-President Vikram Gulati said the Budget not only focuses on inclusiveness, youth empowerment and skill development but also aims to give impetus to "Green Growth" with sufficient outlays for supporting the recently announced National Green Hydrogen Mission, doubling of allocation for FAME 2 scheme and for providing viability gap funding for Battery Energy Storage System (BESS)..Further, the announcement towards fund allocation for scrapping old vehicles of Central and state governments will not only help the environment and reduce fossil fuel consumption but will also generate demand for new vehicles, he added.

Income Tax Rates Should Increase Consumption: Automobile Industry Praises Union Budget 2023

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