GST Effect: Premium cars become substantially cheaper

By Tushaar Singh Gill | on July 2, 2017

Was your favourite luxury vehicle a bit too expensive? GST might have come to your rescue.

1 July, 2017 has passed, and we have now officially entered the Goods & Services Tax (GST) era. The entire country was shaken up during the first half of 2017 preparing for the new GST regulations. Now that GST is very much in action, it’s time to take a look at how your car buying decision may be affected.

The news is gloomy if you have been planning to tame your craving for a big motorcycle – all motorcycles above 350cc will be getting dearer now. On the contrary, it’s a fiesta for those aspiring to buy a premium car.

The GST taxation rate for all vehicles over 4 metre in length, and having engine displacement larger than 1.2-litre and 1.5-litre for petrol and diesel respectively – now stands at a flat 43 per cent. This is considerably lesser than the up to 51.6 per cent tax which was levied during the pre-GST era. SUVs are biggest gainers here – earlier the SUV category was taxed at up to 55 per cent.

Vehicle Type Pre-GST tax Post-GST tax
Small (<4m length) 26% - 35.5% 29% - 31%
Mid-size (<1.5-litre engine) 40.5% - 48.5% 43%
Premium (>4m length, >1.5-litre engine) 44.5% - 51.6% 43%
SUV (>170mm ground clearence) 47.5% - 55% 43%

GST has eliminated the separate category for SUV taxation, and now SUVs, saloons and hatchbacks - all come under the same umbrella. The criteria for taxation post-GST are the vehicle’s length and engine capacity.

A majority of vehicles in the premium spectrum are over 4-metre in length and are powered by big-capacity motors. This means that the price revisions in the premium segment are so juicy that it may motivate you to take your cheque books out very soon. 

SUVs are all the rage right now, and courtesy GST, Tata owned Land Rover products have become super lucrative. As ridiculous as it may sound, the flagship Range Rover has had Rs. 62 lakh slashed from its starting price - that’s equivalent to a Jaguar XF! Other Land Land Rover SUVs too are enjoying good price reductions - the entry-level Discovery Sport is now cheaper by almost 15%.

If saloons are your thing then fret not - Jaguar saloons are also effectively cheaper now, and so is the recently launched Mercedes E-Class LWB. Here are some luxury car price revision highlights.

Model Pre-GST Price Range (INR) Post-GST Price Range (INR) Percentage decrease (approx.)
Toyota Fortuner 26.66 - 31.86 Lakh 24.41 - 29.18 Lakh 8.40%
Jaguar XE 37.25 - 46.34 Lakh 34.64 - 43.21 Lakh 6.75%
Jaguar XF 47.50 - 60.10 Lakh 44.89 - 56.35 Lakh 6.65%
Jaguar F-Pace 68.4 - 119.0 Lakh 67.37 - 110.54 Lakh 7.10%
Mercedes E-Class 57.70 - 69 Lakh 55.70 - 67.00 Lakh 2.89%
Land Rover Discovery Sport 43.80 - 62.18 Lakh 40.04 - 52.88 Lakh 14.95%
Land Rover Range Rover Evoque 45.85 - 67.90 Lakh 42.37 - 56.97 Lakh 16.20%
Land Rover Range Rover Sport 116.0 - 204.0 Lakh 89.44 - 159.4 Lakh 21.80%
Land Rover Range Rover 220.0 - 385.0 Lakh 158.65 - 343.88 Lakh 27.80%

Update on 05-07-2017

Model Pre-GST Price Range (INR) Post-GST Price Range (INR) Percentage decrease (approx.)
Audi A3 30.5 - 35.65 Lakh 30.77 - 35.29 Lakh 1%
Audi Q3 30.50 - 40.98 Lakh 32.48 - 40.60 Lakh 1%
Audi A4 38.10 - 43.30 Lakh 38.4 - 42.66 Lakh 1.40%
Audi A6 52.75 - 53.75 Lakh 51.93 - 52.91 Lakh 1.50%
Audi Q7 72.10 - 80.95 Lakh 70.12 - 77.84 Lakh 3.80%

Tags: GST

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