Believe it or not, a car which is produced in Mumbai costs more in the city than other centres. Vehicles produced in Fiat's Kurla plant in Mumbai cost more in the city as compared to New Delhi despite the high transportation costs.

For example, Fiat Uno in Mumbai costs Rs 3.47 lakh but in Delhi, it costs less at Rs 3.19 lakh. Thanks to this back-breaking tax policy, Mumbai alone is generating a revenue of Rs 1,500 crore for the state by way of various taxes, ranging from sales tax to octroi, imposed on vehicles. ``We are surprised while calculating new vehicle prices, Mumbai carries the highest price tag in the country. Even then it is the second largest market in the country,'' said a Hyundaiofficial.

``North India is the biggest automobile market in the country due to lower taxes... in Mumbai one has to pay octroi, sales and excise taxes which make on the road prices expensive,'' Fiat officials said. Fiat India Automobile Ltd managing director, G Ravina recently told this newspaper that lower taxes will increase sales volumes in the city which will ultimately result in higher tax collection for the government.

In the mid-segment passenger cars, the difference in prices are more. The recently launched, Hyundai Accent, which is made in the Korean company's Chennai plant, costs Rs 5.82 lakh in Mumbai while in Delhi it is cheaper by Rs 50,000. Total taxes in Delhi are 40 per cent of the cost of total a vehicle.

Even within Maharashtra, there are different tariff structures on vehicles. ``Consumers in Mumbai are paying such a high taxes whereas in the neighbouring Thane, cars are cheaper by at least Rs 15,000 due to low Octroi duty,'' Fiat officials said, urging for rationalisation oftaxes.

``We are asking the government to reduce taxes so that more consumers in Mumbai can afford cars. The government can make start by imposing lower taxes in the small car segment,'' a top Telco official said. Telco, makers of Indica, has been given a sales tax concession by the previous BJP Shiv Sena government as the company invested over Rs 1600 crore in its new facility in Pune. But this has not resulted in a lower price tag for the Mumbai consumers. At Rs 2.95 lakh a piece, a diesel Indica is costlier by Rs 9,000 over Delhi consumers.

Surprisingly, despite high taxes, sales are, however, showing an increasing trend of 15 per cent in the current fiscal as compared to last year.