New Delhi, July 25: The Central Board of Excise and Customs (CBEC) has said that manufacturers of sedan cars, including Maruti SX4, Honda Civic and Toyota Corolla Altis, will not have to pay excise duty at the higher rate of 30 per cent levied on SUVs. This clarification will bring huge relief to the car manufacturers struggling with the contracting auto sales for the last few months.
The clarification was called given the confusion arising after the budget announcement 2013-14 which said that vehicles with engine capacity of over 1,500 cc, length exceeding 4,000 mm and ground clearance above 170 mm will have to pay tax at 30 per cent while large segment cars will continue to pay excise at 27 per cent. The confusion arose as sedan cars such as Maruti SX4 met all the three criteria but were not sports utility vehicles.
