GST on bikes: Top Bikes in India that witnessed highest price cuts post GST

While total tax previously charged on motorcycles was 30%, now with GST in place the tax has been relaxed down to 28%

By: | Updated: July 11, 2017 4:20 PM

GST (Goods and Services Tax) was brought into effect by the Government of India on 1st July 2017, triggering a wave of discounts across the automotive sector. GST is essentially a uniform tax structure that will now apply to products and services across the country. The onset of GST affected various industries differently with the automotive industry being one of the gainers. Some car manufacturers actually went on to witness a surge in sales post GST as prices were lowered, increasing customer response. Similarly, motorcycle manufacturers too announced price cuts on their product lineup. While total tax charged previously on motorcycles was 30%, irrespective of the category or engine displacement, now with GST in place the tax has been relaxed down to 28% for motorcycles with engines below 350cc. However, motorcycles above 350cc have seen a rise in tax to 31% due to additional cess. But no matter, the Indian market now has a big number of motorcycles below 350cc, and they've all seen a cut in prices.

Companies had started extending GST benefits to customers even before the final tax structure was applied officially, with Bajaj being the first to announce GST discounts on its product line, followed by Royal Enfield, UM Motorcycles and TVS.

With GST now in place, there is greater clarity over the total tax to be levied on two-wheelers. Bike brands have now revised their price lists and they are all smaller by a margin. Following is a price cut on various motorcycles:

Ex-showroom prices of the sub 350cc KTM range including the 200 Duke, RC 200 and 250 Duke have been reduced by up to Rs 8,600 post GST. Owing to additional cess on 350cc+ motorcycles, the reduction on ex-showroom prices of the 390 Duke and the RC 390 is up to Rs 5,900. Buyers be advised that the price cuts will vary from state to state.

The rates of reduction vary across states depending on the VAT rates that were applicable before GST. Following are post GST reductions on KTM product line up on ex-showroom, Delhi prices:

Post GST price of the 200 Duke: Rs 1,46,073

Price reduction: Rs 1,487

Post GST price of the RC 200: Rs 1,74,797

Price reduction: Rs 1,729

Post GST price of the 250 Duke: Rs 1,75,693

Price reduction: Rs 1,729

Post GST price of the RC 390: Rs 2,34,267

Price reduction: Rs 3,171

Post GST price of the 390 Duke: Rs 2,29,447

Price reduction: Rs 3,089

Although TVS did not specify exact amounts of price cuts, the company insists that it will be significant. TVS CEO K N Radhakrishnan stated that the GST will improve the efficiency of their business therein allowing for some breathing room on the existing price tags. Expect a price cut of about Rs 4300 on the Apache RTR 200 4V and the Victor is now cheaper by Rs 2372.

Price reduction on Bajaj line up is up to Rs 4,500 and the price tag on Honda CB Shine SP has been reduced by up to Rs 2806. The newly launched Yamaha FZ25 saw a price reduction of Rs 1050 post GST, bringing the price down to Rs 1,19,335.

Royal Enfield too announced a price cut on its motorcycles, such as a Rs 2015 reduction on the Classic 350, bringing the ex-showroom price down to Rs 1,50,882. Kawasaki Ninja 300 has also been affected by GST, bringing the price down by Rs 5,000 to an ex-showroom price tag of Rs 4.10 lakh.

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