Normal cars will be cessed same as luxury cars
Yes normal cars are now going to be cessed more, thanks to indian government. The cars which measure more than 4 meter will cost additional 10% cess. So cars like Honda City, Mahindra Scorpio. Tata Safari, Hyundai Creta, Verna etc will now be charged at par with Audi, BMW, Mercedes.
The GST council has approved a proposal to hike the cess on Sport Utility vehicles, mid-sized, large, and luxury cars from 15% to 25%. Cars attract GST of 28% and additional 1-15% cess is charged to compensate the loss to the government due to GST implication.
Not only the cars that measure more than 4 meter is cessed more. Also Small petrol cars of less than 4 metres and 1200 cc are marked for a cess of 1% while small diesel cars of less than 4 meters and 1500 cc engine are levied a cess of 3%.
However, the decision on when to raise the actual cess leviable on the same will be taken by the GST Council in due course.
GST tax rates on cars before the cess:
- Petrol engine Sub-4 meter (small) cars measuring less than 1,200 cc: 28 %
- Diesel engine sub-4 meter (small) cars measuring less than 1,500 cc: 28 %
- Total tax on 4 meter+ (large) petrol and diesel cars: 43 % (28 % GST plus 15 % cess)
GST rates on cars after the cess:
- Petrol engine sub-4 meter (small) cars measuring less than 1,200 cc: 29 % (28 % GST plus 1 % cess)
- Diesel engine sub-4 meter (small) cars measuring less than 1,500 cc: 31 % (28 % GST plus 3 % cess)
- Total tax on 4 meter+ (large) petrol and diesel cars: 53 % (28 % GST plus 25 % cess)
So it you are looking to buy SUV or sedan now is the right time before the cess increases.
