Tata Motors reduces car, CV prices after tax cut

MUMBAI(Reuters) - India's top vehicle maker Tata Motors Ltd on Saturday lowered prices of commercial vehicles and some car models, effective immediately, following a government plan to cut tax on cars and commercial vehicles.

Finance Minister Palaniappan Chidambaram proposed in Friday's budget for fiscal 2008/09 to cut excise duties on small cars, as well as buses and their chasses, to 12 percent from 16 percent.

He also proposed to cut the excise duty on hybrid cars to 14 percent from 24 percent.

Prices on the Tata's Indica hatchback have been cut in the range of 8,500 rupees ($212) to 14,600 rupees and prices on the Indigo compact sedan model have been cut in the range of 12,700-15,300 rupees, a company spokesman said.

Prices of commercial vehicels have been cut by 2 percent.

India's top carmaker Maruti Suzuki Ltd on Friday cut prices of all its small car models by 6,500 rupees on the mini 800 to 18,030 rupees on the Swift diesesl model.