New vehicles’ registration is going to be expensive in Chandigarh from July. The UT administration has decided that the registration will be done at the ex-showroom price rather than the actual invoice — the pattern followed in Punjab.
At present, vehicles are being registered at the actual invoice after discounts.
What is Ex-showroom price?
Ex-showroom price is the cost at which a dealer procures the car from the manufacturer. On the ex-showroom price, automobile dealers provide discount – cash and corporate — in the range of Rs 15,000 to Rs 70,000 depending upon model and make of vehicles. Heavy discounts are given on high-end cars ranging between Rs 1 lakh and 5 lakh.
On an average, around 2,000 vehicles are sold every month in the city. Annually, the administration earns revenue of Rs 600 crore in the form of taxes by sale of cars. There are a total of 52 automobile agencies of different cars and two-wheelers manufacturers operating from phases I and II of Industrial Area.
The Registering and Licensing Authority (RLA) charge 6% of the cost of vehicles costing up to Rs 20 lakh as registration fee, while on vehicles costing more than Rs 20 lakh, registration fee is 8% of the total cost. The transport department charge lump sum registration fee, which excludes Goods and Services tax (GST) and other taxes at the time of registration of new vehicles.
Why shift to ex-showroom price?
The decision of registering the vehicles at ex-showroom price has doubly purpose. The shift is aimed to increase the revenue generation and to put a check on malpractice of under invoicing. In recent years, several cases of under invoicing have been detected by RLA. The Chandigarh Police are also investigating cases in which invoice of high-end vehicles was far less than actual value, which run into lakhs, to pay less registration fee.
V S Saluja, president, Chandigarh Car Dealers’ Association, said consumers, especially of high-end cars, will be affected by the move. “We will continue to offer discounts for benefit of consumers, but they will have pay registration fee on the ex-showroom price,” said Saluja.
Source: Times of India
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