Will GST affect Car Prices?
GST affects Car Prices:
India is on the tip of having a simplified taxation system GST that is going to benefit nearly all the sectors in India. But before the Goods & Service Tax (GST) comes into effect on July 1, and replaces multiple state and central taxes with a single taxation system, let us know how will GST affects car prices in India.
We all know and it pretty certain that cars will fall under the luxury slab and will attract a 28 per cent flat GST. Over and above, an extra cess of 1, 3 or 15 per cent is proposed depending on the classification of cars. GST affects cars as cars proves to be the most effective medium of transportation. We have evolved so much from their discovery and now in the contemporary times, it is the best machine created by mankind. There are many middle class and upper middle class families who are opting for cars rather than bikes. It is the basic need of a family of four to have a car but after the GST what will be the case?
There will be four categories of cars basing on the current segregation of cars and those are small cars, mid-size cars, luxury cars, SUV’s.
Small cars are usually Cars under four-meter length powered by a petrol engine not greater than 1.2-liter or a diesel engine not greater than 1.5-liter by displacement. Mid-size cars are Cars over four-meter length powered by either a petrol or a diesel engine not greater than 1.5-liter displacement. Luxury cars are Cars over four-meter length powered by either a petrol or a diesel engine that is greater than 1.5-liter displacement. And SUV’s are Cars over four-meter length and 170 mm ground clearance powered by either a petrol or a diesel engine that is greater than 1.5-liter displacement.