German luxury car maker Mercedes Benz on Tuesday said that levy of cess might see prices of its vehicles go back to what was prevalent before implementation of Goods and Services Tax. Mercedes Benz India, Managing Director, Roland Folger, said that the situation may go back to ‘square one’ due to levy of cess for large cars and Sports Utility vehicles if Government does not intervene.
He was speaking to reporters after inaugurating the company's first AMG Performance Centre here, the seventh in the country. To a query, he said that after GST was implemented,prices (of Mercedes Benz cars) went down.
“Then we had cess.It is still an ordinance. It may be back to square one (if cess is levied). The price may go what was (prevailing) before GST”, he said. Under the GST regime, large cars with engine capacity of greater than 1,500 cc and SUVs with length of more than four metres and engine greater than 1,500 cc attracts cess of 15 per cent in addition to the top tax rate of 28 per cent. The overall tax incidence on locally-assembled luxury cars had come down from around 55 per cent earlier to 43 per cent in the GST regime.