Duty 'cut' goof-up on Twitter as auto companies hike car prices

The government's 'MakeInIndia' Twitter handle created a flutter on Tuesday by erroneously stating that excise duty on cars and two-wheelers has been cut, but corrected the mistake later.

Later, leading auto manufacturers Maruti Suzuki, Hyundai and General Motors hiked prices by up to Rs 1.27 lakh attributing it to increased input costs as also to the withdrawal of the duty sops.

The @makeinindia, a Twitter handle managed by the ministry of commerce and industry, posted that duties on small, large and mid-segment cars as well as two-wheelers has been slashed in the range of three to four per cent. The tweet generated much interest as it came within days of over ten-month-long duty concessions ending on December 31.

Excise duty has been reduced for small cars & two-wheelers (12% > 8%), large cars (27% > 24%) & midsegment cars (24% > 20%) #MakeInIndia, said the tweet. As the news spread, the Twitter handle posted a correction nearly five hours later saying, "These excise duty reductions were valid till 31 December, 2014 #MakeInIndia."

Revenue secretary Shaktikanta Das told news agency PTI that the news flash on Twitter was false.

Maruti Suzuki hiked prices in the range of Rs 7,850-Rs 31,600 while rival Hyundai Rs 15,000-Rs 1,27,000 effective January 1.General Motors India also hiked prices of various models in the range of Rs 15,000-Rs 61,000.

"The increased prices after revision of Central excise duty with effect from January 1, 2015, across all models ranges between Rs 7,850 on Omni van to Rs 31,600 on midsized sedan Ciaz," said a Maruti Suzuki official. Alto 800 will be dearer by Rs 8,500-Rs 12,700. WagonR from will see an increase ranging from Rs 12,500-Rs 15,700 from its current tag of Rs 3.48 lakh-Rs 4.35 lakh.

Maruti's premium compact car Swift will cost Rs 15,850-Rs 25,150 more now from the current price of Rs 4.42 lakh-Rs 6.95 lakh. Dzire will see an increase from Rs 17,500 to Rs 26,650 from the current price of Rs 4.85 lakh-Rs 7.32 lakh.

Hyundai Eon will be costlier by Rs 15,417, i10 Rs 21,501, Grand i10 Rs 22,508, Xcent Rs 25,597, Elite i20 Rs 29,814, Verna Rs 23,965, Elantra Rs 36,912.

Hero MotoCorp said that it has also passed on the impact of increase in excise duty to consumers without sharing the details.