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GST Impact on automobile industry: All you need to know

Toyota Fortuner@ Rs. 25.92 - 31.12 Lakhs

India has finally implemented the simplified and singular taxation system called GST (Goods and Services Tax) which came into effect on 1st July 2017. It will replace multiple state and central taxes, 17 to be precise with a single tariff. With GST now implemented, the question arises that how it will make an impact on the Automobile industry. In general, the cars have become cheaper while hybrids are no longer comes under the tax benefit as they also have to bear the strain of GST. Let’s figure out how GST will impact car prices in India.

CategoriesCurrent Tax Rates*GST

Base   Cess   Total

Small cars (>1200cc):34% Petrol,

35.5% Diesel









Mid-size cars (over 4m length or not greater than 1500cc)44.5%-48.5%28%15%43%-(1.5-5.5)
Luxury cars (Over 4m length or more than 1500cc)44.5%-51.5%28%15%43%– (1.5-8.5%)
SUVs (Over 4m length, 170mm ground clearance and greater than 1500cc)47.5%-54.5%28%15%43%– (4.5-11.5%)


*Current Tax included: Excise (12%), VAT (12.5-14.5%), Infra Cess (1%), Octroi (4% in selected cities), 1% of green Cess (for above 2000cc cars).

Maruti Suzuki was one of the first to cut prices by up to three percent on most of their products. Toyota is also not far behind as it has slashed the prices up to Rs. 12.26 lakh with Fortuner getting up to Rs. 2.17 lakh price cut. The Implementation of GST has also caused the modification in prices of JLR series of cars; the brand has slashed the prices up to whopping Rs. 48 lakh.

Have a look at the list of cars affected by GST:-

CarGST Impact (In Delhi)
Maruti Suzuki AltoAffordable by Rs. 1000
Maruti Suzuki CelerioAffordable by Rs. 2000
Maruti Suzuki BalenoAffordable by Rs. 32,000
Maruti Suzuki DzireAffordable by Rs. 3000
Maruti Suzuki IgnisAffordable by Rs. 26,000
Toyota EtiosAffordable by up to Rs 40,000
Toyota Corolla Altis petrolAffordable by up to Rs. 1.24 lakh
Toyota Innova CrystaAffordable by up to Rs 1.37 lakh
Toyota FortunerAffordable by up to Rs 2.68 lakh
Toyota Camry petrolAffordable by up to Rs 2.01 lakh
Jaguar XEAffordable by up to Rs 3.13 lakh
Jaguar XJAffordable by up to Rs 5.11 lakh
Land Rover Discovery SportAffordable by up to Rs 4.28 lakh
Land Rover Range Rover LWBAffordable by up to Rs 48 lakh
Audi A3 dieselAffordable by Rs 51,000
Audi A8LAffordable by Rs 95,000
Audi A6 dieselAffordable by Rs 84,000
Audi RS 6Affordable by Rs 9.1 lakh

Ex-showroom Prices of almost all cars except Hybrid are likely to go down by decent margin. The drop is likely to vary in the range of 2.25 percent to 12 percent. The biggest advantage will go to SUVs and Luxury cars. Thanks to the rise in insurance from 15 to 18 percent changes in the actual prices for most could be very negligible. In the coming months, we might see a boost in sales of cars of the segments which have observed a price slash.

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