New GST rates 2025: Maruti Suzuki Alto, Maruti Suzuki Wagon R to be cheaper by up to Rs 67000
&imwidth=600&imheight=450&format=webp&quality=medium "New GST rates 2025: Maruti Suzuki Alto, Maruti Suzuki Wagon R to be cheaper by up to Rs 67000")
Models stand next to the cars at Bharat Mobility Global Expo 2025. Photograph: (ANI file)
New GST rates 2025: The GST rate on small cars will be reduced from 28 per cent to 18 per cent. On larger cars, there will be a sin tax of 40 per cent, but it will be lower than the existing taxes.
Maruti Suzuki chairman RC Bhargava said on Thursday that the prices of his company's most popular cars will drastically decrease after the Centre lowered GST on small cars. The Centre on Wednesday announced that GST's 12 per cent and 28 per cent slabs will be eliminated. Most of the goods and services will be moved from these slabs into the 5 per cent and 18 per cent GST slabs.
Bhargava said that the Maruti Suzuki Alto, the company's cheapest offering, may become cheaper by Rs 40000-50000. Wagon R, another of the company's popular offerings, may become cheaper by Rs 60,000-67,000.
“With the latest GST reduction, we project that the small car market, which was degrowing, will now grow this year by over 10 per cent,” Bhargava was quoted as saying by Business Standard.
He said that the overall car market will grow by 6-8 per cent. This is because the consumers will have more money to spend, which may provide a fillip to domesticconsumption.
He said that even luxury cars will get cheaper because the Centre has capped the sin tax at 40 per cent. For a car price at Rs 1 crore, he said, a 5 per cent tax difference will amount to significant savings.
What are the new GST rates on cars?
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The GST rate on small cars will be reduced from 28 per cent to 18 per cent. For GST, small cars are defined as those LPG, petrol, and CNG cars with an engine capacity up to 1200 cc and a length under 4000 mm. The GST rate on all mid-size and large cars -- vehicles exceeding 1500 cc or length exceeding 4000 mm – will be 40%.
Motor vehicles in the category of Utility Vehicles, including Sports Utility Vehicles (SUV), Multi Utility Vehicles (MUV), Multi-purpose Vehicles (MPV) or Cross-Over Utility Vehicles (XUV), with an engine capacity exceeding 1500 cc, length exceeding 4000 mm, and ground clearance of 170 mm and above, will also attract a GST rate of 40% without any cess.