GST Provision, taxes and tax rates applicable before and after GST

Category Before GST After GST

Two wheelers 30.2% 28-31%

Commercial vehicles 30.2% 28%

Luxury cars 50% 42-45%

Small cars 24-25% 29-31%

Hybrid cars 30% 43%

Spare parts 12% 28%

Segment Excise *Nccd  +auto   cess VA *Road *Motor TOTAL CGST SGST TOTA Difference
T vehicle tax L
tax

Small Cars 12.50% 1.1% 14% State State 28% 9% 9% 18% 10%
<1200cc based based (approx.)

Mid-SizeCars 24% 1.1% 14% State State 39% 9% 9% 18% 21%

from 1200cc based based
to 1500cc

Luxury 27% 1.1% 14% State State 42% 14% 14% 28% 14%
Cars>1500cc based based

SUV’s 30% 1.1% 14% State State 45% 14% 14% 28% 17%
>1500cc, based based
>170mm
ground
clearanc

Table showing the different types and rate of taxes levied on the passenger vehicles/SUV.

GST Rate on Automobiles

GST rate on automobiles is calculated with the fixed base rate of 28% on all cars with additional
cess slabs such as 1%, 3%, 15%, 17%, 20%, and 22%. Both the cess and base rate
together impacts GST rate on the automobile sector.

1. Two-Wheelers (bikes, shooters etc.)

GST impact on two-wheelers is rather low as the 350 cc or below engine is taxed in 28 percent
slab and engine above 350 cc is charged with 31 percent tax.

2. Commercial Vehicles ( Bus, Truck etc.)

Most commercial vehicles fall under the 28 percent tax rate, which was 30.2 percent
previously. However, as these fall into 15 percent cess slab, which makes the tax 43 percent,
minibuses have been greatly impacted. While most commercial vehicles have seen a
negligible effect after GST implementation, concerns have been raised about GST on 13
passenger minibuses.

3. Luxury Car (BMW, Lamborghini etc.)

As these vehicles are taxed at 42-45%, the luxury car tax scenario has seen good times with
GST. But this was 50 percent or more previously. So for luxury vehicles, the overall tax has
decreased.

4. Small Cars ( Maruti Aulto, Hyundi etc. )  

As the tax rate was previously 29 percent, which included all taxes including VAT, small
cars were not significantly impacted by GST implementation. But after GST, it's 28
percent and 1 percent is cess.

5. Hybrid Cars

The major GST effect on automobile industry can be seen in hybrid cars, as these are taxed 28%
with additional 15% cess. Previously, hybrid cars were taxed at 30% only.

6. Spare Parts

Spare parts are taxed at the maximum slab rate of 28 percent, although it was previously just 12
percent, which makes the new tax charges more than twice what was previously paid.