New GST rates on all cars in India, from Alto to Mahindra Thar and Tata Nexon

The GST Council has reduced GST rates on small cars to 18% and SUVs are in a new 40% slab. Here’s a look at the new GST rates on all cars in India.
The government has come through on a longstanding demand of India’s automotive industry, that of a GST rate cut on cars to increase adoption of personal mobility in the country. After all, while India is the third-largest car market in the world, adoption is abysmally low at 32-34 cars per 1,000 people.
The 56th GST Council has reduced the tax on small cars to 18% from 28% earlier. Bigger cars, including SUVs are in a new 40% slab—without any additional cess, that reduces the final tax incidence. Electric cars will continue to attract 5% GST. All auto components—irrespective of the vehicle type they go into—are also rated at 18%.

“This decision (GST rate cut on cars) will not only make vehicles more affordable, but also simplify the classification disputes that have long been a source of ambiguity for the industry,” Saurabh Agarwal, partner and automotive tax leader at EY, said in a note. “The removal of cess will provide crucial support to a sector that is a vital engine of economic growth.”
The GST Council has defined the small car as less than four metres with petrol/CNG/LPG engines less than 1,200 cc and diesel engines less than 1,500 cc. Any car that’s longer and larger will attract 40% GST.

Against that backdrop, here are the new GST rates on cars, from entry-level to the most luxurious in the mass market segment.