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Mahindra, Tata Motors, Maruti Suzuki, and Renault all announced price cuts, making entry-level automobiles more affordable.
The Next Gen GST amendments announced by Finance Minister Nirmala Sitharaman earlier this month went into effect on September 22. Vehicles and motorbikes with engines up to 350 CC will enjoy a tax decrease.
These vehicles were previously taxed at 28%, but have now been reduced to 18%. This entry-level automobile will be more inexpensive.
According to the new laws, two-wheelers with more than 350 cc and larger cars are now subject to the 40% luxury goods tax. Meanwhile, electric vehicles will continue to be taxed at 5%.
Tax on small automobiles
Cars with petrol engines up to 1200cc or diesel engines up to 1500cc and a length of no more than 4000 mm are considered compact cars. These vehicles will now be taxed at 18% GST rather than the previous 28%, making models such as the Alto and i10 more affordable.
Tax on bigger cars
Cars that do not match the requirements for smaller cars will be taxed at 40%. As per the former tax rate, 28% tax was applied, plus a cess of up to 22%, for a total of almost 50%. That will now change, with a 40% overall tax levied.
Companies announced new pricing.
Following the announcement of GST rate decreases, various car manufacturers, including Mahindra, Maruti Suzuki, Jeep, and Tata Motors, announced lower prices for their vehicles.
Tata Motors
Tata Motors was the first to announce reduced GST costs, cutting prices by up to ₹1,55,000. Tiago experienced a price fall of up to Rs. 75,000, and Tigo saw a price cut of up to Rs. 80,000. Altroz, Punch, Nexon, Curvv, Harrier, and Safari have all seen price reductions.
Mahindra
Mahindra, the maker of SUVs, announced price cuts on its major car models in order to pass on the benefits of the GST rate drop. Mahindra’s Bolero, Bolero Neo, XUV 3XO, and Thar 2WD (Diesel) are taxed at 18%, while the remainder are subject to 40% GST.
Maruti Suzuki
Maruti Suzuki announced a ₹1,07,600 price reduction for the entry-level Alto K10, now priced at RS 3,69,900. Similarly, the Grand Vitara dropped in price by the same amount, now priced at Rs. 10,76,500.
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