With fears of a recession in the ranks looming large, the government is likely to lend a helping hand to the commercial vehicle sector by way of an excise duty cut on trucks and buses.
Currently, trucks attract a duty of 14 per cent while buses enjoy a 2 per cent leverage at 12 per cent but with sales of both segments in the negative in this fiscal so far, government sources said a duty cut is on its way. There are, however, no indications of the quantum of reduction though the next slab is 8 per cent.
“The Prime Minister’s core committee on economic affairs is considering a duty cut in goods and passenger carriers, which play an important role in the overall economy,” said an official in the department of heavy industries.
Only a fortnight back former finance minister P Chidambaram had asked the sutomotive industry to reduce prices, promising to reduce excise duties in return.
Commercial vehicle sales have fallen by 3 per cent between April and October this year, with sales of heavy trucks and buses falling by 11 and 4 per cent, respectively. In November, market leader Tata Motor’s commercial vehicle sales crashed by 40 per cent, with heavy trucks and bus sales declining by 60 per cent year-on-year.