Planning to buy a vehicle? Here's how GST will affect your plans

Cheryl Sanders
July 1, 2017

The company said that the new prices would be applicable from 1st July 2017.

Automakers in India report despatches to dealers and not end buyers.


In Bhubaneswar, the capital of Odisha, customers queued up outside shops and malls, which remained open till late Friday night to clear stocks of watches, electronic gadgets, cosmetics and gold at discounted rates before the GST regime kicked off at midnight. "The rate of reduction varies across locations depending on the Value-Added Tax rates applicable prior to GST".

Tax on small cars after GST regime sets in will be levied between 29-30 per cent, whereas before it was 26-28 per cent. For example, the Mercedes GLS350 SUV will be cheaper by Rs 3 lakh, while Hyundai's popular Creta is expected to see a drop between Rs 40,000 and Rs 60,000.


Under the previous taxation system, SUVs and other luxury cars were taxed above 50 per cent, however, after the GST the taxes on these cars have come down to 43 per cent including the cess. "Any change in prices, if it works in the customer's favour, will be adequately taken care off", a Hyundai official said. BMW offered benefits up to 12 per cent on ex-showroom prices that include GST benefits, depending on choice of the model. "There are different tax rates across various states currently, and the final calculations are being carried out now".

"This drop in volume is seen temporary and will be recovered in the quarter to come based on 11 per cent growth in April-June 2017 quarter compared to the past year", Tata Motors said in a statement. "We will be passing on the price benefit to the market". It has also reduced the price of Baleno in the range of Rs 6,600 and Rs 13,100.


However, bikes over 350cc will become expensive with models from companies such as Royal Enfield, Triumph, Harley-Davidson and Ducati getting dearer.

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