taxes-on-cars

Hello Guys last time I explained what is GST and current taxes in India. Today I will explain taxes on cars. First the original taxes then the change on taxes after GST.

Excise Duty on Vehicles

Vehicle Category Excise Duty %
Small cars 12.5%
Length >4m but engine capacity less than 1500cc 24%
Length >4m and engine capacity more than 1500cc 27%
SUVs/MUVs (length >4m, engine capacity >1500cc and Ground clearance >170mm) 30%
Hybrid cars 12.5%
Specified components of Hybrid vehicles 6%
Electric cars, Buses, 2W & 3W 6%
Specified components of Electric vehicles 6%
Buses 12.5%
Trucks 12.5%
Three wheelers 12.5%
Two wheelers 12.5%

Import Duty on Imported Vehicle

Criteria  / Applicability Import Duty in %
Used car import 125%
Cars CBUs whose CIF value is more than $ 40,000
or Petrol Engine > 3000 CC
or Diesel engine > 2500 CC
100%
Cars CBUs whose CIF value is less than $ 40,000
and Petrol Engine < 3000 CC
and Diesel engine < 2500 CC
60%
Two-wheeler CBUs with engine capacity <800 cc 60%
Two-wheeler CBUs with engine capacity >=800 cc 75%
Commercial Vehicle CBUs (Trucks & Buses) 20%
CKD containing engine or gearbox or transmission mechanism in pre-assembled form but
not mounted on a chassis or a body assembly
30%
CKD containing engine, gearbox and transmission mechanism not in a pre-assembled condition 10%

Taxes on vehicles after GST

Tax Type Tax Rate
GST

 

Vehicle Category GST Rate
Electric Vehicles – Falling under tariff heading 8702, 8703, 8704, 8711 12%
Passenger Vehicles/Commercial Vehicles/Three-wheelers/Two-wheelers – Falling under tariff heading 8702, 8703, 8704, 8711 28%
Compensation Cess
Vehicle Category Cess
>4m passenger vehicles (Petrol, Diesel, CNG, Ethanol, methanol, hybrid electric and fuel cell) 15%
<4m passenger vehicles (petrol, CNG, Ethanol, Methanol) 1%
<4m passenger vehicles (diesel, Ethanol, Methanol) 3%
>350cc two-wheelers falling in tariff heading 8711 3%
10 – 13 seater public transport vehicles falling in tariff heading 8702 15%

 

Taxes in components (Post Purchase)

Component Rate
Taxes on Fuel 45% to 55%
 GST on Insurance Premium  18%
GST on Labor Charges 18%
 GST on Spare Parts – Tyre, Battery, Spare Parts  28%
Service Tax on Loan Foreclosure 18%