Latest Updates 31 July 2019
Any services for hiring an electrically operated vehicle meant to carry more than twelve passengers provided to a local authority is exempt with effect from 1 August 2019.Pre-GST Tax Laws on Automobiles
Table showing the different types and rate of taxes levied on the passenger vehicles/SUV.Segment | Excise | *Nccd +auto cess | VAT | *Road tax | *Motor vehicle tax | Total | CGST | SGST | TOTAL | Difference |
Small Cars <1200cc | 12.50% | 1.1% | 14% | State based | State based | 28%(approx) | 9% | 9% | 18% | 10% |
Mid-SizeCars from 1200cc to 1500cc | 24% | 1.1% | 14% | State based | State based | 39% | 9% | 9% | 18% | 21% |
Luxury Cars>1500cc | 27% | 1.1% | 14% | State based | State based | 42% | 14% | 14% | 28% | 14% |
SUV’s >1500cc, >170mm ground clearance | 30% | 1.1% | 14% | State based | State based | 45% | 14% | 14% | 28% | 17% |
Impact of GST on the Automobile Industry
The two taxes charged to the end consumer on car and bikes previously were excise and VAT, with an average combined rate of 26.50 to 44% which is higher than the GST rates of 18 and 28%. Therefore, there will be less burden of tax on the end consumer under GST.
Latest Updates 30 September 2019
Item* | Previous Rate | Current Rate |
Cess on Petrol/CNG Motor Vehicles (Capacity of 10-13 passengers & engine capacity not exceeding 1200 cc) | 15% | 1% |
Cess on Diesel Motor Vehicles (Capacity of 10-13 passengers & engine capacity not exceeding 1500 cc) | 15% | 3% |

Conclusion
GST reduces the cost of manufacturing of cars and bikes due to the subsuming of different taxes levied previously. Under GST, the taxes would be charged on consumption state rather than the origin state, which would give a boost to the growth rate of the automobile industry.Simplify Your GST Filing & Invoicing
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