Union Budget 2015-16: Import duty on commercial vehicles, steel to go up
28 Feb 2015
The budget has raised the tariff rate imported commercial vehicles, iron and steel and articles of iron or steel as also the basic customs duty for metallurgical coke.
Tariff rate on commercial vehicles has been increased from 10 per cent to 40 per cent and effective rate from 10 per cent to 20 per cent.
This has been done to support domestic manufacturers of automobiles in a market where the pick-up even around the festive season has not been maintained.
Furthermore, the withdrawal of excise cut forced auto makers to increase prices, thereby affecting sales.
However, to boost to the government's green initiative, the finance minister has waived off duty on electric and hybrid vehicles.
The FM has also allocated Rs 75 crore for electric vehicles.
Auto analysts do not see this benefiting domestic CV majors like Tata Motors and Ashok Leyland in a big way. That is because it affects only the high end hydraulic power steering CVs produced by players like Volvo and Mercedes.
According to CNBC-TV18, only 500-1000 high HP CVs are imported annually.
Shares in steel manufacturers like Tata Steel and JSPL gained as the government proposed to increase customs duty on imported steel to 15 per cent from 10 per cent now to stem a flow of cheap supplies from China and Russia.
Tata gained as much as 4 per cent to an intraday high of Rs354, while JSPL surged nearly 3.8 per cent to Rs. 201.20.