Maruti’s SX4, Honda’s Civic and Toyota’s Altis to attract 27% excise duty

Maruti’s SX4, Honda’s Civic and Toyota’s Altis to attract 27% excise dutyThe Maruti SX4, Honda Civic and Toyota Corolla Altis will attract excise duty of 27 per cent, rather than 30 per cent duty prescribed for Sports Utility Vehicle (SUVs), the Finance Ministry's Revenue Department clarified on Wednesday.

Prior to the clarification, there was confusion on whether these the aforementioned vehicles would attract 30 per cent excise duty prescribed for SUVs or 27 per cent applicable to large sedans.

In Budget 2013-14, the government defined SUVs as vehicles having length of more than 4,000mm, ground clearance of 170mm or more, and engine capacity of more than 1,500cc.

The Maruti SX4, Honda's Civic and Toyota's Corolla Altis satisfy all the aforementioned three conditions, but the revenue department these vehicles are not known as SUVs in trade parlance.

Issuing the clarification, the Central Board of Excise & Customs (CBEC) said, "They are reportedly known as sedans in trade and common parlance. It is clarified that these vehicles will attract the excise duty of 27 per cent as applicable to large segment cars."

Car manufacturers sought the clarification as many large sedans come with similar technical features as that of SUVs.

The clarification has emerged as great relief for Maruti, Honda and Toyota, which have been struggling to boost sales amid overall slowdown.