Planning to buy a new car although not sure the way the prices got affected once GST rolled in?
This Turtlemint article has your back! Continue reading to understand much more about GST and its implications on the price of passenger cars.
What is GST?
GST is an indirect tax levied on products or services throughout India, from July 1st, 2021 onwards. Most taxable businesses and persons have to register for GST making GST payments to the government electronically, online. The streamlined procedure for GST payments and refunds is intended to generate more transparency and accountability.
The GST bill has been passed to simplify the Indian tax sector. Instead of the multiple-tier excise duty structure used earlier for passenger cars, the new tax structure under GST levies an optimum duty of 28% along with cess, which varies according to the type of car.
GST & the Indian car industry
Overall, the GST move has shown positive for automobile manufacturers and customers. The tax on passenger cars continues to be reduced to a more 43 percent since GST rolled in. Moreover, the supply chain mechanism has improved under the GST registration framework. Since GST registration is required for many business entities including large auto parts suppliers, manufacturers will now have the ability to procure auto parts at a cheaper cost.
Automobile brands like Skoda, Nissan, Tata Motors, Renault, Mahindra & Mahindra, Honda, Ford, Maruti Suzuki, Toyota, BMW, Mercedes-Benz, and Audi have already started passing on the GST advantages to consumers by reduction of the price of their car models.
Almost all passenger cars have discounted tags since July 1st. Even the interest in luxury cars, which had begun dwindling last year, has started to rise because of the rationalization of taxes.
The only negative impact of GST has been on the costs of the fuel-efficient hybrid cars. For example, the prices of hybrid variants Toyota Camry and Toyota Prius have been hiked by over Rs. 3.5 lakh in Bengaluru and up to Rs. 5.24 lakh in Delhi.
Some cars that you can now purchase cheaper are mentioned within the table below:
Now that you know which car GST makes cheaper, you can make an informed purchase decision. Check out the 8 ways to keep your car cool in summer and also the 5 destinations from Mumbai you are able to drive to, dear future car-owner!
Did you realize, car insurance companies are likely to revise premiums because of GST? Car insurance companies might spread the price hike to you, the end-consumer, by increasing the premiums they charge!
Need some assistance finding a cheap auto insurance policy? Turtlemint enables you to compare different auto insurance policies offered by auto insurance companies. Call our Car Expert at 1800-266-0101 or head on over to turtlemint.com to get car insurance quotes to have an easy car insurance comparison.
