The government jacked up the advance tax on buyers of cars over1,600cc in the budget 2022-23. Buyers of Toyota Fortuner, which has an engine size of 2,755cc, will now be paying Rs200,000 more after the increase in advance tax.
Buyers of automobiles between engine sizes of 1,600cc and 1,800cc will be paying Rs150,000 instead of Rs75,000 advance tax. Advance tax on vehicles between engine size 1,800cc and 2,000cc would now be Rs200,000 from Rs100,000.
Tax has also been doubled on cars between the engine size of 2,000cc and 2,500cc from Rs150,000 to Rs300,000. For vehicles between engine size 2,500cc to 3,000cc, advance tax has been increased from Rs200,000 to Rs400,000.
Advance tax on all vehicles above 3,000cc has also been doubled from Rs250,000 to Rs500,000.
Meanwhile, advance tax on non-filer has been increased from 1% to 2%. A 2% advance tax has also been imposed on electric cars.
Research analyst at Ismail Iqbal Securities Muqeet Naeem said doubling of advance tax on automobiles above 1600cc vehicles may have little impact on buying behavior since the segment is not price sensitive.
“The auto sector has largely been overlooked this time in the budget,” the analyst said.
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