Deluxe

1% luxury tax to impact luxury consumption

DELHI

Luxury sector experts have given a thumbs down to the government’s budget proposal of imposing a 1% tax at source on luxury goods exceeding Rs 2 lakh and car purchases exceeding Rs 10 lakh.

“I feel that in a scenario where the consumer sentiment is already low, this could spell lower purchases in India for luxury goods and services,” said Sanjay Kapoor, founder and managing director of Genesis Luxury which has a mix of joint venture and marketing and distribution arrangements with brands such as Burberry, Canali, Jimmy Choo, and Giorgio Armani, reports The Economic Times.

“Psychologically the luxury consumer may feel better about shopping overseas for the same brands which in any case they perceive as cheaper overseas. We have tried to correct this perception over the years, but with such new levies it just goes against the case of shopping in India,” he added.

LEAVE A REPLY

Please enter your comment!
Please enter your name here