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Maruti Dzire WEB 1

The Goods and Services Tax is probably the only thing you’ve been hearing about lately, unless you live under a rock.

Commonly known as GST, this unified tax has finally taken over the Indian market after much anticipation. Been in effect since July 1, 2017, it has received mixed reviews by the citizens of our country. However, certain benefits have come to the fore, particularly in the automotive space, with various manufacturers announcing price reductions thanks to the benefits of GST. Here are some of the major price cuts that have taken place in the automobile industry.

Maruti Suzuki

Like most car manufacturers, Maruti Suzuki have passed on the entire benefit of GST rates on vehicles to their customers. The ex-showroom prices of Maruti Suzuki models have come down by up to 3 per cent. The rate of reduction varies across locations depending on the VAT rates applicable prior to GST.

They have also reduced the prices of some of their hatchbacks in Delhi despite a slight increase in tax burden in the capital city. In Mumbai, prices of Maruti Suzuki’s small cars are considerably lower than before with a drop of up to Rs 18,000 in the prices of the Alto range. The Baleno RS sees the maximum price drop in the Maruti Suzuki range in Delhi (Rs 32,000) as well as in Mumbai (Rs 78,000).

Maruti Suzuki’s SHVS-powered cars are the worst hit by GST since hybrid vehicles attract 43 per cent tax (28 per cent GST and 15 per cent cess). So, while the Ciaz SHVS is about half-a-lakh rupees costlier in Mumbai, prices of the car have gone up in Delhi by almost Rs 1 lakh.



The price reduction on Hyundai models will be up to 5.9 per cent, ex-showroom, Delhi. The drop is substantial for cars that cost over Rs 20 lakh, such as the Tucson and Santa Fe. For smaller cars such as the Grand i10 and Elite i20, ex-showroom prices have come down by up to Rs 10,000 in New Delhi. The price drop is higher in Mumbai comparatively.

Grand I10 WEB 1


Honda have also reduced prices of all their cars in India. The company is, however, yet to announce the price of the Accord Hybrid. GST has hit hybrid cars the worst as they are now taxed as regular petrol or diesel cars.



Tata have decided to pass on the entire benefit of the new tax regime to their customers. They are offering a price reduction of up to 12 per cent ranging between Rs 3,300 and Rs 2.17 lakh, depending on the model and variant. With a strong focus to encourage positive buying sentiments.



The prices of vehicles for end-customers on large UVs and SUVs have been reduced by an average of 6.9 per cent, while those that come under small car segment have been reduced by an average of 1.4 per cent. Similarly, end-customer prices have been reduced by an average of 1.1 per cent for small commercial vehicles and 0.5 per cent for LCVs and HCVs.

Since the GST rates on hybrid vehicles are significantly higher than that in the pre-GST regime, the prices for the end-customers of hybrid vehicles have been increased marginally.



Nissan India announced that ex-showroom prices of the company’s products have been reduced by an average of 3 per cent depending on city and model specification.



BMW have provided additional benefits since the new tax regime. Overall benefits sum up to 12 per cent on ex-showroom prices (GST benefits plus additional benefits) depending on choice of model. Additional benefits (in addition to GST benefits) on select models include reduced rate of interest of 7.9 per cent, complimentary service and maintenance for 3 years, complimentary insurance for 1 year, and assured buyback up to 4 years.

Mercedes and Audi have also reduced prices up to Rs 10 lakh.

There was ample joy for luxury carmakers when the GST rates saw car prices fall, making them more affordable, but now even supercar makers reap the benefits as road tax has been capped at Rs 20 lakh in Maharashtra. This comes as good news to a lot of future super sports cars, luxury car or premium SUV owners who pay huge amounts of road tax to get their cars registered inside state limits. This also means that supercars will become even cheaper with the new GST rates and updated road tax structure and the problem of out-of-state registered sports cars and luxury cars will cease to exist.

Lamborghini-Aventador_S WEB 1

Supercar makers such as Lamborghini have already seen a fall in on-road prices. So, now if you buy an Aventador S, which costs Rs 5.01 crore (ex-showroom), you now save Rs 80 lakh on road tax. Of course, this does not include the cost of insurance, which has gone up by 3 per cent but that, of course, is negligible compared to the savings you make on the tax for the car.

GST PricesStory: Aahil Akkalkotkar


About the author: Online Car India



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