Maruti Alto worth Rs 4 lakh would have been even cheaper if there was no tax hassle, know how?
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New Delhi : To make the journey easy and safe, man considers car as the most accessible vehicle as a personal vehicle. Those who have money, like to buy expensive and luxury cars. At the same time, people from middle class families want to buy a car equipped with good features at a low price. Although, low priced cars are also available in the market, but tax is what kills a person. Now let us tell you that in India, Maruti Suzuki’s Alto car is available for just Rs 4 lakh, but if we talk about the tax levied on its purchase, then we start sweating.
The biggest thing is that today Maruti Suzuki’s Alto car is very popular among middle class families. Especially, people living in small towns of the country like it more. The starting price of this car starts from Rs 4 lakh. The specialty of Maruti Suzuki’s Alto car is that one has to spend less on its maintenance. That is why middle class people like it more and its demand is also good, but when it comes to tax, the pocket gets punctured. So let us know how much tax people have to pay on the purchase of Alto?
Maruti Suzuki Alto on road price
Let us tell you that the price of the base model of Maruti Suzuki Alto is around Rs 3.54 lakh in the ex-showroom of Delhi, while the price of its top model is around Rs 5 lakh. If we talk about its base model only, then the on-road price of Alto, which is available for Rs 3.54 lakh in the ex-showroom, becomes slightly higher by Rs 3.93 thousand. Now you will be surprised to know why there is this difference of about Rs 40 thousand between ex-showroom price and on road price? So the simple and straightforward answer is that the difference of Rs 40 in the on-road price of Alto is due to the tax imposed on its purchase.
What is the mathematics of tax?
To understand the issue of ex-showroom price and on road price when buying cars, first of all you have to understand the price breakup. A large part of the price of a car is included in the form of tax. In this, customers mainly have to pay GST (Goods and Services Tax) and registration fees. The Ministry of Road and Transport has fixed the rates of GST and compensation cess according to the size and segment of the model. This means that the larger the size of the car, the more tax will have to be paid on it. You will be surprised to know that people who buy a big size luxury car have to pay almost 50 percent tax on it.
How much tax is charged on Maruti Alto?
Now if we talk about the tax on Maruti Suzuki’s Alto car, then its price in the ex-showroom of Delhi is around Rs 3.54 lakh. You will have to pay about 28 percent GST on the purchase of this car. This GST includes 14 percent CGST and 14 percent SGST. Apart from this, one percent compensation cess has to be paid. Including GST and cess the total tax becomes about 29 percent. On this car, Rs 38,718.75 has to be paid as CGST and Rs 38,718.75 as SGST or UTGST. Now if you add these two taxes together, then you have to pay Rs 77,437.50 as tax. After this, if we add Rs 2758 as one percent cess, the total tax will become Rs 80,195.50. Now if you subtract Rs 80,195 from the ex-showroom price of Rs 3.54 lakh, the original price of Maruti Alto comes to Rs 2,73,805 only.
How much are the registration and insurance charges?
Now when you buy a car, it is also necessary to get it registered and insured. The rates of registration fees are decided by the Regional Transport Office i.e. RTO. In Delhi, around Rs 14,990 has to be paid as registration fee for the base model of Alto. Along with this, one has to pay around Rs 20,683 to get the car insured. Apart from this, around Rs 4,000 is spent as other charges. Now if you add registration fees, insurance charges and other expenses to the ex-showroom price, then the on road price of the base model of Alto reaches around Rs 3,93,058. Now we will see in this way, your pocket becomes loose just by paying tax on the purchase of Maruti’s cheapest car Alto.
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