Why Luxury Cars are So Expensive in India

If you're looking to buy a super-luxury car, such as a Lamborghini, Ferrari or Aston Martin, you may be in for a shock when you see the price tag. In India, these cars cost almost three times more than their real price due to the high taxes imposed by the government. Currently, if you decide to buy a Lamborghini, you have to spend more than 150% in duties and taxes. For cars that are fully imported as fully built units (CBU), taxes are even higher - the import duty alone is set at 100%.

And that's not all - there are a large number of other taxes that are added on top of the import duties. This is why so many luxury cars sold in India push the 1 crore rupee mark. The car may or may not be imported as a CBU (Complete Built-Up) unit. Parts are often imported and then built in India as CKD (Complete Knock Down) units.

Parts imported under the CKD system are also subject to high taxes. Import duties are calculated at 30% for engine or gearbox mechanisms that are pre-assembled but not mounted on a chassis or body assembly. Engines, gearboxes and transmission mechanisms that are not pre-assembled are subject to a 10% import duty. Luxury cars like the Toyota Camry and the Skoda Superb are 120% more expensive before they reach you, the buyer.

The Dzire is the best-selling sedan in the country and is very affordably priced, while the Camry is aimed at those looking for a luxury car and only sells around 100 units each month. So why is it that luxury cars cost so much more in India? The answer lies in the high taxes imposed by the government. These taxes make it difficult for buyers to purchase luxury cars, as they have to pay an exorbitant amount of money just to get their hands on one. The government has implemented these taxes in order to discourage people from buying luxury cars and instead focus on buying more affordable vehicles.

This helps to reduce traffic congestion and pollution levels in cities, as well as helping to reduce the strain on public infrastructure.

Shari Venturelli
Shari Venturelli

Professional beer trailblazer. Total communicator. Freelance web expert. Wannabe coffee practitioner. Hardcore sushi maven. Passionate food guru.