GST price hike – segment wise break up

With the GST Council revising tax rates again for the automotive industry, we try to provide a better picture with a segment wise break up of how the prices for vehicles have been affected.

The GST bill was passed recently which revised the tax structure with new rates being implemented on July 1, 2017. This brought down the prices of most cars with SUV benefiting the most. Following the announcement of the new tax slabs for the automotive sector, the council announced that they would revise the rates again.

As of Saturday (September 9, 2017), the revised slabs have been implemented which have increased the prices of larger sized vehicles. Vehicles which fall under the sub-4 metre segment have seen no change following the new revised rates. Mid-size vehicles with engine capacity less than 1.5-litre have seen a marginal increase of just two per cent and now stand at 45 per cent. The tax on premium cars (over 4-metres in length with engine capacity over 1.5-litre)  has now been increased to 48 per cent while all SUVs (with over 170mm ground clearance) will now be taxed at 50 per cent.

With the new slabs, prices of most vehicles have now increased to the amount they were at, prior to the introduction of the Goods and Service Tax structure on July 1.

The new rates have now forced manufacturers to increase the prices of most products. Here is a segment wise break up following the cess hike: