The Central Board of Excise and Customs (CBEC) recently announced some major changes that are bound to affect major superbike making leaders in the market. The Government has slashed custom duties on completely-built-units (CBU) bikes below 800cc from 60 per cent to 50 per cent, while CBU bikes above 800cc have also seen a major custom reduction from 75 per cent to 50 per cent.
Apart from CBU units, the rules have been heavily revised for completely-knocked-down (CKD) and semi-knocked down (SKD) units as well. The earlier tax of 30 per cent on (SKD) kit in pre-assembled form of motorcycles have been taken down by 5 percent and now sits at 25 per cent. However, the custom duty on import of engine, gearbox and transmission mechanism which are not pre-assembled (CKD) has been hiked from 10 per cent to 15 per cent.
The hike in custom duty on CKD bikes is a clear hint that the government wants to promote local manufacturing. With the step of taking down import taxes on CBU bikes, manufacturers like Aprilia, BMW Motorrad, MV Agusta, Indian Motorcycle and Moto Guzzi will be all smiles. While the British motorcycle maker, Triumph Motorcycles will now be contemplating on its earlier announced plan of locally assembling 90 per cent of its line-up.
As published by our friends at Autocarindia.com, Triumph Motorcycles India MD Vimal Sumbly said, “After the budget, this is a great initiative to cut import duties on CBUs, but for CKDs where the local assembly is done in India, the import duties are increased by 5 percent and the FTA remains unchanged. We would urge the government to relook into this area.”
Commenting on the same, Mr. Pankaj Dubey, MD & Country Head, Polaris India Pvt. Ltd. said, "We had been advocating the reduction of import duties for quite some now and we are glad that the Government has paid heed to our demands and rationalised the import duty structure to 50% across the range for imported bikes. This will enable more Indian customers to enjoy the quality and refinement provided by these high-end bikes. We are confident that this will lead to not only growth in sales of luxury bikes in the country but also indirectly lead to retail space off take and jobs creation at expanding dealerships. I see this opening up Auto component industry for global sourcing thus facilitating a boost to Make in India campaign of the Government."