GST – Maxabout News https://news.maxabout.com Latest Car & Bike News in India Sat, 09 Nov 2019 07:51:08 +0000 en-US hourly 1 https://wordpress.org/?v=4.8.9 https://news.maxabout.com/wp-content/uploads/2017/09/cropped-Maxabout-News-Favi-Icon-2017-32x32.png GST – Maxabout News https://news.maxabout.com 32 32 Govt May Reduce GST on Automobiles; Bike & Car Prices Could Go Down https://news.maxabout.com/gst/govt-may-reduce-gst-on-automobiles/ https://news.maxabout.com/gst/govt-may-reduce-gst-on-automobiles/#respond Thu, 05 Sep 2019 05:58:14 +0000 https://news.maxabout.com/?p=520237 According to a recent report by TOI, Nirmala Sitharaman, the finance minister of India indicated that the government may cut the GST imposed on the cars and bikes. Presently, the automobiles are under the 28% GST slab while the final decision on reducing the GST would be taken by the GST council soon. Since the […]

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According to a recent report by TOI, Nirmala Sitharaman, the finance minister of India indicated that the government may cut the GST imposed on the cars and bikes. Presently, the automobiles are under the 28% GST slab while the final decision on reducing the GST would be taken by the GST council soon.

Since the Supreme Court’s decision to implement the new emission norms in India will be valid from April 1, 2020, the government of India plans on hearing all the difficulties being faced by major sectors in India and offer alternate solutions.

Talking to the reporters on the possible GST reduction, Sitharaman stated – “The automobile sector was in a transition phase to produce engines and components meeting BS-VI fuel norms (from the earlier BS-IV), which comes into effect from April 1, 2020.”

The reports suggest that the Indian government has requested the GST council to give a thought on reducing the GST applicable on cars and motorcycles. To boost the declining sales in the automotive sector, the government is also focusing on enhancing liquidity and lending in the market.

When asked about the increasing unemployment in the automotive sector, she reported that the major employers in the economic sector have been witnessed in the informal sector for which there is no proper documentation.

Commenting on the ongoing confusion between electric vehicles and internal combustion engine, Sitharaman stated “We want all the vehicles to have due market share. We are not pushing one at the cost of others.”

According to the reports, the government plans on offering tax relaxation to revive the automotive sales while at the same time, undertake other necessary actions regarding the downfall in the industry.

Major automotive brands will be introducing new products near the festive season to give a boost to sales. To gather customer attention, some of the car brands have already listed various discount offers on their portfolio for the festive season.

The recent government policy has commanded the depreciation cost of automobiles purchased till March 31, 2020, to be increased to 30% from 15%. The government has opposed to increasing the one-time registration fee till June 2020 while new scrappage policies have also been implemented.

Source

2019 Motor Vehicle Amendment Bill
2019 Motor Vehicle Amendment Bill Implemented

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Petrol & Diesel Won’t Be Included Under GST [Quick Report] https://news.maxabout.com/gst/petrol-diesel-wont-included-gst/ https://news.maxabout.com/gst/petrol-diesel-wont-included-gst/#respond Fri, 24 Aug 2018 06:02:35 +0000 https://news.maxabout.com/?p=253589 The most awaited decision of putting petrol and diesel under the GST slab may not be implemented anytime soon in India. The report comes after both central and state govt showed fear of losing a considerable amount of revenue and did not favor the one nation, one tax policy. GST was implemented in 2017 from […]

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The most awaited decision of putting petrol and diesel under the GST slab may not be implemented anytime soon in India. The report comes after both central and state govt showed fear of losing a considerable amount of revenue and did not favor the one nation, one tax policy. GST was implemented in 2017 from July 1, completing one full year of ups and downs last month.

Many industries received benefits from its implementation while others showed how they were badly hit by the change in tax policy. GST basically combines value added tax, service tax and excise duty, dividing products into four slabs of 5%, 12%, 18% and 28%. Most everyday products fall in the first two segments while availing services from most sources are taxed under the 18% slab.

Automobile sector falls under the 28% segment, further getting higher tax rates by including additional cess on these base values. The biggest example is the above 4-meter car segment, paying 53% of total tax with 25% of cess on the base value. Most experts were believing the fact that the government will tax petrol and diesel under the 28% slab with a bigger cess than that seen on the car market.

One such example of huge taxation is the tobacco industry, paying 160% of cess over the regular 28% taxation. Presently, petroleum products and alcohol are the only industries that are out of the GST regime. The highest amount of VAT charged on petrol is in Mumbai whereas all UTs have the lowest taxation on petroleum products.

GST was a brilliant idea of bringing things under one umbrella but, the application of cess on the ground values have disturbed many industries. For some, the values remain identical as government played safe by putting a similar amount of GST as the total of earlier taxes, which also includes cess.

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Diesel Cars to Get Expensive, 2 Percent Tax Hike Proposed by Ministry of Road Transport https://news.maxabout.com/gst/diesel-cars-expensive-2-percent-tax-hike/ https://news.maxabout.com/gst/diesel-cars-expensive-2-percent-tax-hike/#comments Fri, 20 Apr 2018 05:24:47 +0000 https://news.maxabout.com/?p=208726 2 Percent Tax Hike on Diesel Cars: Ministry of Road Transport and Highways has proposed 2% increase in GST over cars carrying diesel engines. This will result in increase of price for all Indian diesel cars, irrespective of their length, size or engine size. Present GST value on cars is higher than most nations as […]

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2 Percent Tax Hike on Diesel Cars: Ministry of Road Transport and Highways has proposed 2% increase in GST over cars carrying diesel engines. This will result in increase of price for all Indian diesel cars, irrespective of their length, size or engine size.

Present GST value on cars is higher than most nations as their is a great difference in taxes introduced in July 2017 and those applicable in April 2018. Petrol cars under 4 meter carry 29% GST while those coming with diesel engine under same length carries 31% GST. Adding this 2% will result in 33% GST on small diesel cars in India.

Tax Hike on Diesel Cars
Diesel Cars to Get Expensive Soon!

Cars with length over 4 meter have been listed under luxury segment as government now imposes flat 53% GST on all cars, whether they carry small engine, big engine or fall under SUV category. This change was implemented from January 1, 2018.

Now, after the 2% increase in GST on diesel cars is implemented, these cars will split into two different sections where petrol engines of same car will attract 53% GST while diesel will be charged with 55%. For example, Toyota Fortuner Petrol will still carry INR 26.20 lakh price while Fortuner Diesel will get considerable price hike (INR 36,000 approx).

Tax Hike on Diesel Cars
2 Percent Tax Hike on Diesel Cars Proposed by Ministry of Road Transport

The move is not at all positive for automotive sector as buyers prefer diesel as fuel for most SUVs and luxury cars in India. High torque requirement is fully managed by diesel engine while petrol engine of same size may not feel as effective in terms of weight management and pulling power.

Taxes on cars in India is one among the highest when compared to countries were sales are even big in number than India. Growth stalls with this big number as after 2% increase, customer will need to pay 55% tax (above 4m) on a locally manufactured diesel car in India.

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Big Drop in GST on Used Cars in India https://news.maxabout.com/gst/gst-on-used-cars/ https://news.maxabout.com/gst/gst-on-used-cars/#respond Tue, 23 Jan 2018 03:44:53 +0000 https://news.maxabout.com/?p=184166 GST on used cars has been reduced significantly to just 12-18%. Before this recent update, the slabs varied between 29-54.7%. The changes are valid from 25 January 2018 while these lower and upper percentage figures are for small used cars (12%) and large used cars (18%) respectively. This change was passed in 25th meeting of […]

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GST on used cars has been reduced significantly to just 12-18%. Before this recent update, the slabs varied between 29-54.7%. The changes are valid from 25 January 2018 while these lower and upper percentage figures are for small used cars (12%) and large used cars (18%) respectively.

This change was passed in 25th meeting of GST council in New Delhi. They even discussed on ways to make GST fillings easier. The cess applied on top of actual values in now removed while total GST value has also gone down considerably for used cars. Dealers were paying these values on their margins after selling the car.

New GST on Used Cars

  • Small Cars – 12%
  • Large Cars – 18%
GST on Used Cars
Honda City is one of the best-selling used cars in India

Organised sector of used cars in India was under real pressure from the last high values of taxes on older cars. The council even reduced taxes on public vehicles using bio-fuel and claimed the new e-bill system to get ready by Feb 1, 2018. Indian automobile market saw GST as a relief when it was first launched back in July 2017.

Prices for most products were reduced but few months later, changes were made to bring things back on track with added cess values to the presently applied GST levels. Slabs start from as low as 5% but went higher to 28% for selected sectors like automobile.

GST on Used Cars
Toyota Innova has best resale value in premium cars in India

Apart from the sub 4 meter petrol cars, almost every other car manufactured in India attracts a cess over this 28% GST value. This is the highest for SUV segment as buyers have to pay 53% GST on each product.

This means that car belonging to this category will cost almost INR 20 lakh to manufacturer and whooping INR 30+ lakh to the buyer. After that, buyers has to pay almost 11% of the value as road tax and other essentials. That counts to almost 64% in terms of overall taxes over the value.

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GST Cess on Luxury Cars & SUVs Increased from 15% to 25%, Applicable from January 1, 2018 https://news.maxabout.com/gst/gst-cess-on-luxury-cars-suvs-increased/ https://news.maxabout.com/gst/gst-cess-on-luxury-cars-suvs-increased/#respond Thu, 28 Dec 2017 04:50:52 +0000 https://news.maxabout.com/?p=174051 GST Cess on Luxury Cars & SUVs Increased! A recent bill passed in the Lok Sabha replaced the ordinance issued around September 2017 regarding the cess on base 28% GST on cars above 4 meter in length. The New GST Cess Rate is Flat 25%, taking the total amount of tax on cars above 4 […]

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GST Cess on Luxury Cars & SUVs Increased! A recent bill passed in the Lok Sabha replaced the ordinance issued around September 2017 regarding the cess on base 28% GST on cars above 4 meter in length. The New GST Cess Rate is Flat 25%, taking the total amount of tax on cars above 4 meter to 53%.

After the latest amendment in the rate , GST Cess on Luxury Cars will see an Increase of 10% from the base 15% cess issued in July 2017. As government fixed these values to 43% after GST roll-out, this bill will take the total value to 53% from January 1, 2018. Here is a table to clarify the changes based on different dates.

GST Cess on Luxury Cars & SUVs Increased

Old GST Cess – 15% | New GST Cess – 25% | Applicable from January 1, 2018
Cars (4 Meter+ in Length) July 1, 2017 Sept 8, 2017 Jan 1, 2018
Engine (Less than 1500cc) 43% (28%+15%) 45% (28%+17%) 53% (28%+25%)
Engine (More than 1500cc) 43% (28%+15%) 48% (28%+20%) 53% (28%+25%)
SUVs 43% (28%+15%) 50% (28%+22%) 53% (28%+25%)
Hybrid Cars 43% (28%+15%) 43% (28%+15%) 53% (28%+25%)
GST Cess on Luxury Cars & SUVs Increased
GST Cess on Luxury Cars & SUVs Increased from 15% to 25%

The actual increase of GST cess on luxury cars (SUVs in this case) will be just 3 percent while the most affected section will be the buyers from Honda City, Hyundai Verna and Maruti Ciaz segment. They will see an actual hike of almost 8% from the current tax rates.

Applicable from the first day of 2018, the new taxes will add up to the 2-3% price hike announced by most manufacturers. Sales trend may get a shock as buyers will prefer sub 4 meter cars with just 29% and 31% of tax rates on petrol and diesel engines respectively.

GST Cess on Luxury Cars & SUVs Increased

Buyers who are looking for a car under sub 4 meter section (i20, Baleno, Jazz) will simply get the price hike decided by the manufacturer. Government plans to increase the revenue and compensate state governments for losses that came through the implementation of GST.

The biggest jolt will be seen on the lineup of Mercedes Benz, BMW, Audi and other manufacturers of this segment as 3-5% is still too much for them. The increase of GST cess on luxury cars will turn up into a big number in revenue for both state and center government.

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GST Rates Revised on Cars & SUVs, Cess Hiked, Old vs New GST Rate https://news.maxabout.com/gst/gst-rates-revised-on-cars-suvs-cess-hiked-old-vs-new-gst-rate/ https://news.maxabout.com/gst/gst-rates-revised-on-cars-suvs-cess-hiked-old-vs-new-gst-rate/#respond Mon, 11 Sep 2017 09:16:32 +0000 https://news.maxabout.com/?p=154387 A recent amendment in GST slabs for automobiles brought increase in the overall values for mid size, luxury and SUV segments. As expected, the GST for sub 4 meter petrol and diesel cars with engine displacement less than 1.2L and 1.5L respectively was kept the same. This equates to 29% (28+1) for small petrol cars […]

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A recent amendment in GST slabs for automobiles brought increase in the overall values for mid size, luxury and SUV segments. As expected, the GST for sub 4 meter petrol and diesel cars with engine displacement less than 1.2L and 1.5L respectively was kept the same.

This equates to 29% (28+1) for small petrol cars and 31% for same segment diesel cars. This helps all cars like Baleno, i20 Elite, Dzire and Amaze retain their present price tags. Another sub 4 meter segment that comes with engines bigger than the above given limit also stays intact at 43% GST (28+15).

Next clause comes when a car exceeds the 4 meter length barrier. Government will now charge 45% (28+15+2) for mid size cars and 48% (28+15+5) for those falling in the large car segment. Worst hit segment remains SUVs as they will now fall under 50% GST slab (28+15+7).

As notification regarding this matter arrived today, the changes are already applicable on all given segment. The plan for cess hike was initially 10% but came out to be 2%, 5% and 7% for these three segments. Apart from these, hybrid and electric cars retain their 43% and 12% of already fixed slab.

Here is how the correct division of segments occurs among these cars:
# Small Car (Petrol) – Less than 4 meter, engine displacement less than 1.2L, 29% GST
# Small Car (Diesel) – Less than 4 meter, engine displacement less than 1.5L, 31% GST
# Small Car – Less than 4 meter, engine displacement greater than 1.2L (petrol) and 1.5L (diesel), 43% GST
# Midsize Car – Greater than 4 meter, engine displacement not greater than 1.5L (petrol & diesel), 45% GST
# Large Car – Greater than 4 meter, engine displacement greater than 1.5L, 48% GST
# SUV – Greater than 4 meter, ground clearance over 170mm, 50% GST

Every SUV over 4 meter will now fall under the highest taxed slab while those under the compact section are free from any price hike in coming days. This will result in lower sales in the upcoming festive season for bigger cars. Most affected manufacturers from this hike are luxury manufacturers while brands like Mahindra even have a considerable section under SUV category. As cess on petrol and diesel small cars remain the same, they are expected to sell in even large numbers than before during the festive season. Most manufacturers have not yet updated their price lists online.

Falling income of states is the biggest reason behind this tax hike while it is even believed that affordability percentage of buyers in this segment is higher than any other existing segment. Brands actually plan their products according to government regulation as it’s hard to find a car with less than 4 meters of length and a bigger engine than 1.2L petrol and 1.5L diesel limit, saving the 43% rate to just 31% in most cases (as done with Maruti Dzire few years ago). Still, the suffering rises when they have a full fledged festive season in front after such a huge tax rise.

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GST Effect: RTO Charges | Car & Bike Insurance https://news.maxabout.com/gst/gst-effect-rto-charges-car-bike-insurance/ Thu, 06 Jul 2017 07:11:35 +0000 https://news.maxabout.com/?p=113908 Implementation of GST has brought a considerable change in on-road pricing of various vehicles. The huge drop was limited to certain states only as cars in Delhi saw a little change (except for SUVs, luxury cars) in their ex-showroom price. The change in price of the same car in Mumbai was worth consideration as Octroi […]

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Implementation of GST has brought a considerable change in on-road pricing of various vehicles. The huge drop was limited to certain states only as cars in Delhi saw a little change (except for SUVs, luxury cars) in their ex-showroom price.

The change in price of the same car in Mumbai was worth consideration as Octroi was removed from the complete process. GST is now applicable on everything, including the calculation of on-road price of a vehicle. Here are the applicable changes on you new price quote.

Tax on insurance will go up by 3 percent, keeping the services same as before but charging 18 percent GST instead of the old 15 percent of service tax. That simply means that an insurance scheme that costs INR 100 will now cost INR 118 but could have been bought for INR 115 before July 1, 2017. This would mean an addition of INR 300 while you buy an insurance for your car worth INR 10,000.

The change in insurance cost for everyday commuter bikes will not be as loud as the drop in price of the same bike. RTO charges or registration cost will definitely drop as the price of vehicle while registration saw a fall through GST. No increase in charge was witnessed in Delhi while automobile fans from Mumbai will face the heat with 2 percent increase in RTO charges.

A petrol car in Mumbai needs to pay 11-13 percent of tax while diesel need 13-15 percent of payment as registration cost. Motorcycles will even pay more as they are now taxed between 10-12 percent. The amount of RTO tax depends upon engine size.

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Octroi Abolished in Maharashtra | Road Tax Hiked by 2% https://news.maxabout.com/gst/octroi-abolished-in-maharashtra-road-tax-hiked/ Wed, 05 Jul 2017 08:34:00 +0000 https://news.maxabout.com/?p=113871 Maharashtra witnessed a 2% hike in one time road tax on registration of private cars and 2-wheelers in the state. The move came right after the implementation of GST and end of state level octroi in 22 Indian states. Government shows a loss of INR 700 Crore every year with the end of octroi. This […]

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Maharashtra witnessed a 2% hike in one time road tax on registration of private cars and 2-wheelers in the state. The move came right after the implementation of GST and end of state level octroi in 22 Indian states.

Government shows a loss of INR 700 Crore every year with the end of octroi. This will recover through this increase in the road tax, taking the value to 11-13% for petrol and 13-15% for diesel cars. The change depends on cost of vehicle as the old values were 9-11% for petrol and 11-13% for diesel cars.

The registration cost for motorcycles now fall between 10-12%, leaving behind the 8-10% slab that was applicable till June 30, 2017. The increased tax will also count the recently introduced 2% road safety cess from the customers.

Octroi Abolished in Maharashtra | Road Tax Hiked by 2%

The annual revenue after this increase in the road tax will count around INR 750 Crore, compensating the loss that came after end of octroi. Prices of all cars and 2-wheelers witnessed a huge change in most pars of India. Cars that fall above 4 meter in length and have bigger engines than 1.5 liter saw the biggest change.

About INR 1 lakh gets reduced on every 12 lakh that is used for buying a sports utility vehicle in India. The same was even seen on luxury cars as prices of all BMW, Audi and Mercedes cars saw a steep decline after GST.

The state cabinet has even decided to cap the road tax at INR 20 lakh, keeping people away from registering cars in the nearby UT’s. Maharashtra has a huge share in sales of luxury cars and benefits passed would help many realize their dream of owning a car that falls one segment above their present car.

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Effect of GST on Gold Prices in India https://news.maxabout.com/gst/effect-gst-gold-prices-india/ Fri, 30 Jun 2017 06:57:22 +0000 https://news.maxabout.com/?p=113542 Goods and Service tax is just few hours away from implementation. Most of us are wandering about the changes that will come with this new tax structure. GST will bring a certain level of rise and fall of charges that we currently pay for all the services and products. When it comes to Gold, the […]

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Goods and Service tax is just few hours away from implementation. Most of us are wandering about the changes that will come with this new tax structure. GST will bring a certain level of rise and fall of charges that we currently pay for all the services and products.

When it comes to Gold, the impact of GST will bring a marginal rise in the overall pricing. The total tax will increase from 12.4 percent to 14 percent, raising the initial cost of buying a INR 100 worth of Gold from INR 125.60 to INR 127.20, this figure includes the custom duty, making charges and GST.

After charging 10% custom duty on Gold, the excise and value added tax that first made 1% and 1.2 percent will change to 3 percent GST. The government will even charge GST of 5 percent on the making charges of 12 percent, making things expensive at the end.

This certain move is expected to be beneficial for big players that work under the organized jewelry sector. The gap between them and the unorganized sector will come down, ultimately pushing more customers into their side.

Frequently Asked Questions About GST

1) What is the meaning of GST?

2) What are the GST Tax Slabs?

3) What are the benefits under GST?

4) What is the Full Form of GST?

5) How GST Works?

6) When will GST be Implemented?

7) What are the Taxes that GST Replaces?

8) What will be the Short-term Impact of GST?

Related Articles

1) Effect of GST on Bikes & Scooter Prices

2) Effect of GST on Cars & SUV Prices

3) Effect of GST on Mobile Phone Prices

Effect of GST on Popular Brands

1) Bajaj Motorcycles

2) Honda Bikes & Scooters

3) Royal Enfield Motorcycles

4) KTM Duke & RC Sport Bikes

5) TVS Motorcycles & Scooters

6) UM Renegade Motorcycles

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What is GST? Effect of GST on Prices | All You Need to Know https://news.maxabout.com/gst/effect-of-gst-on-prices-all-you-need-to-know/ https://news.maxabout.com/gst/effect-of-gst-on-prices-all-you-need-to-know/#respond Fri, 30 Jun 2017 04:44:01 +0000 https://news.maxabout.com/?p=113527 GST stands for Goods and Service Tax. The new tax structure will soon be implemented in order to get away from complicated taxation at different levels of products manufacturing and sales. The ex-showroom price we see on every product is a result of value added tax, excise duty and various other cess in the Indian […]

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GST stands for Goods and Service Tax. The new tax structure will soon be implemented in order to get away from complicated taxation at different levels of products manufacturing and sales. The ex-showroom price we see on every product is a result of value added tax, excise duty and various other cess in the Indian market.

These will now fall under a single name and may help Indian buyers secure peace of mind while going out on shopping. The first bill charging GST will be produced on July 1, 2017. The impact of GST is not that huge on everyday products but those in the luxury category have considerable differences in both the segment.

Most brands have started passing the benefits to customers as drop in prices are pretty visible on a selected segment of products. Let’s find out how things will change after implementation of GST in India. Bikes under 350cc will enjoy tax relaxation from 30 percent to 28 percent. This will help brands place their products lower than the present prices.

The reduction of 2 percent would be on the manufacturing price of the machine, thus giving the authority to regulate prices in the hands of manufacturers only. For example, Bajaj recently decreased the price of Pulsar NS200 by around INR 900. Royal Enfield has also confirmed officially that the price of their 350cc motorcycles will go down from July 1.

Effect of GST on Bike Prices

The bikes above 350cc will now face cess of 3 percent on the tax slab of smaller bikes. That practically takes the tax rate up by 1 percent. One can safely assume that the bike that costs INR 13 lakh will now get a price hike of INR 10,000.When the same thing comes to luxury cars, they will get a tax reduction of up to 12 percent. The same is applicable on sports utility vehicles (SUV) as both of the categories now get 43 percent overall tax on them.

Effect of GST on Car Prices

Everyday cars that fall under 4 meter and carry an engine smaller than 1.2L petrol/1.5L diesel will now get 29 percent and 31 percent tax respectively. Petrol cars get 2.5 percent while diesel cars 2.25 percent of tax reduction. Cars with bigger engine or more length than 4 meter will attract a tax rate of 43 percent, making them fall in the same category as SUV’s and luxury cars. The change in percentage is lesser on these cars than SUV’s.

List of GST Discounts on Cars

Hybrid cars will now become more expensive as government will charge the same 43 percent tax on these vehicles. Smart hybrids will no longer fall in the low tax category while fully electric cars are soon to be cheaper with tax deduction from 20.5 percent to just 12 percent. The effects on cars is much more visible as bigger price tags attract bigger reduction for the buyers. The lowest decrease would even be around INR 6,250 for a car with INR 2.5 lakh price tag.

Effect of GST on Mobile Phone Prices

GST will effect everything in the economy, revising prices for most categories that were inappropriately taxed from last few decades. Eating out will have different taxes based on the revenue and air conditioning facility of the place. Technology will become cheaper as smartphones are placed in a low tax slab than other electronic products like air conditioner, microwave etc. GST will help Indians simply the tax calculations for sure.

Related Articles

1) Post-GST Bajaj Bikes Price List

2) Post-GST Renegade Price List

3) Post-GST Yamaha Price List

4) Post-GST Honda Price List

5) Post-GST KTM Price List

Frequently Asked Questions About GST

1) What is the meaning of GST?

2) What are the GST Tax Slabs?

3) What are the benefits under GST?

4) What is the Full Form of GST?

5) How GST Works?

6) When will GST be Implemented?

7) What are the Taxes that GST Replaces?

8) What will be the Short-term Impact of GST?

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