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Big Relief for Car Buyers: GST Cut Makes Small Cars Cheaper
Most Affordable Car After GST Rate Cut (Petrol, Diesel, or Electric): The new GST slabs were implemented nationwide on September 22nd. This has generated significant excitement among car buyers. Car companies have reduced the prices of all cars, big and small, to pass on the benefits to customers. Let's find out which car will be most economical to buy now: petrol, diesel, CNG, or electric.
The government has offered a big respite to consumers by lowering vehicle taxes from the new GST slabs. Earlier, the vehicles used to be charged 28%-30%, but it has now been lowered to 18%. On the other hand, the tax on luxury and large cars has been lowered from 45%-50% to 40% only. Therefore, if you are looking to purchase a new car, know first which car will be more useful for you: petrol, diesel, hybrid, or electric.
If you're planning to buy a small car, this news is especially beneficial for you. All petrol, CNG, LPG, and petrol-hybrid cars with a length of up to 4000mm and an engine capacity of up to 1200cc (1.2 liters) will now attract 18% GST instead of 28%. These cars include the Hyundai i10, Tata Punch, Maruti Suzuki Swift, Hyundai Xter, Maruti Dzire, and Tata Nexon.
For example, if the ex-showroom price of a Maruti Swift is ₹6.49 lakh, its price could be reduced by approximately ₹65,000 after the new GST slab. This means you'll now have to spend less to purchase your favorite hatchback or compact SUV.
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Like petrol, diesel vehicles have also received some relief. Diesel and diesel hybrid cars with a length of up to 4000mm and an engine capacity of up to 1500cc (1.5 liters) will also be subject to 18% GST. Popular diesel vehicles like the Tata Altroz, Tata Nexon, Kia Sonet, and Mahindra XUV300 fall into this category. Meanwhile, the Mahindra Scorpio-N, Scorpio Classic, Toyota Fortuner, Kia Carens, and MG Hector (petrol and turbocharged diesel engines) will be charged 40% GST.
GST rates on electric vehicles have not been altered. The government is already charging only 5% GST on electric cars, scooters, bikes, and three-wheelers, which has not changed. Hence, these are still the cheapest for customers. Additionally, electric vehicles also receive road tax exemptions and subsidies in many states, which can result in significant savings for customers.
Looking at the new GST rates on different vehicle types, cars up to 4 meters in length with 1.0, 1.2, and 1.5-liter petrol and hybrid engines have become the most affordable options. Meanwhile, diesel cars up to 4 meters in length with up to 1.5-liter engines have become more affordable. If you are planning to buy a new car this festive season, now is your best chance to save.
