GST or the Goods and Service Tax has worked in favour of new cars which have witnessed price cuts based on the body type and engine capacity which were parameters earlier as well. However, the old tax structure had a number of them being implemented which were Excise Duty, NCCD (National Calamity Contingency Duty), CST (Central Sales Tax), Infra Cess and VAT (Value Added Tax). VAT varied from one state to the other, but with the new tax structure, the plethora of taxes that were incurred by cars have reduced to GST and additional cess. The new tax structure has also witnessed price cuts particularly with larger cars such as SUVs, MPVs and even supercars. Some of the exotic cars sold in the country have seen a price reduction in the tune of Rs 1 crore while even more affordable cars like the Tata Hexa have witnessed a price drop of over Rs two lakh. Under GST, cars are taxed on two parameters, GST and additional cess wherein the additional cess varies for different categories while GST remains at a constant 28 percent. Small petrol cars will incur 29 percent tax, while small diesel cars will now attract 31 percent. Cars categorised in the above four metres in length but having engine capacity lower than 1,500 cc, above four metres and over 1,500 cc, SUV and Hybrid will now be taxed at 43 percent. Here is the list of which cars have benefitted the most from the implementation of GST.
Tata Hexa: Price cut of up to Rs 2.17 lakh
Tata Motors made an official announcement that all models in their current product lineup would witness price reductions from Rs 3,300 to Rs 2.17 lakh, depending on the model. The car that has witnessed the highest price cut from the Indian carmaker's stable is the Hexa which will see a price cut of over Rs two lakh, depending on the variant, which is likely to be the top-end trim with all the bells and whistles.
Isuzu MU-X: Price cut of up to Rs 1.61 lakh
Although the Japanese manufacturer currently has a limited product portfolio, all of them are categorised in the SUV category. In the previous tax structure, the tax on these cars was a little over 55 percent, however, with the implementation of GST, the tax on the Isuzu D-Max V-Cross and the Isuzu MU-X which are available for the passenger vehicle segment fell in the range of six to 12 percent. This meant the Isuzu MU-X that was priced at Rs 23.99 lakh, ex-showroom, Delhi now costs Rs 22.38 lakh, ex-showroom. The Isuzu D-Max V-Cross also got a price cut from Rs 13.30 lakh, ex-showroom Delhi to Rs 12.67 lakh, ex-showroom.
Skoda Octavia: Price cut of up to Rs 1.76 lakh
Although Skoda India is all set to introduce a facelifted version of the Octavia on 13th July, 2017, GST benefits were implemented which incurred a price reduction between 4.9 percent and 7.4 percent. The current version of the Octavia Diesel Ambition version which is the top-end trim after implementation of GST now costs Rs 20.15 lakh, ex-showroom.
Skoda Superb: Price cut of up to Rs 2.4 lakh
Another sedan from the Skoda India's stable that has received a sizeable price reduction is the Superb sedan. The price of the Superb which also gets up to 7.9 percent price cut starts from Rs 25.57 lakh and goes up to Rs 30.81 lakh, ex-showroom. The Superb is the company's flagship model currently sold in India, but the Kodiaq which will be launched in India soon will become the company's flagship product in the country.
Toyota Fortuner: Price cut of up to Rs 2.68 lakh
One of the very popular premium SUVs in India, the Toyota Fortuner has received a price cut of up to Rs 2.68 lakh. The base petrol manual version of the Toyota Fortuner is now priced at Rs 24.41 lakh, ex-showroom, a reduction of Rs 2.19 lakh over the pre-GST price tag.The top-end diesel automatic trim of the premium SUV which is offered with an automatic transmission as well as a shift-on-the-fly all-wheel-drive system is now priced at Rs 29.18 lakh attracting a reduction in the price of Rs 2.68 lakh compared to the price before GST implementation.
Lamborghini Aventador S: Price cut of over Rs one crore
The major beneficiaries from the implementation of GST are supercars which are already priced for crores of rupees after incurring all the requisite taxes and duties. One such example is the Lamborghini Aventador S, the more powerful version of the Aventador, which gets a price cut of over Rs one crore. Before the implementation of GST, the Lamborghini Aventador S was priced at Rs 6.23 crore, ex-showroom and after the new tax structure's impact, the supercar costs Rs 5.22 crore.
Small cars such as the Tata Tiago, Renault Kwid, compact SUVs like the Ford EcoSport, Maruti Suzuki Vitara Brezza and other mass market vehicles have also received a decent price reduction after the implementation of GST. The new tax structure has surely worked in favour of most segments apart from hybrid cars like the Toyota Camry Hybrid which earlier attracted 30.3 percent tax and now incur 43 percent. This isn't really in sync with the Government's vision of going all-electric in terms of mobility by the year 2030. That said, the start of the new tax structure will see some changes in the future to work in favour of hybrid cars.