Today’s Date is witnessed for a milestone in Indian Taxation system. New GST(Goods and Service Tax) applied from today onwards. This system will make taxation more simple and easier, most important tax regulation will in control of central government. Now, every state can’t apply a different percentage of VAT according to their own.
Will GST make everything less costly than before?
Not actually, GST taxation system has a different slab with different percentage of applied tax to make it more simple like never before. Yes, we can say many of things will less costly for some time but not all. For e.g. Helmets are in 18% tax slab, which will escalate their prices than before. Helmet manufacturers raise their voice against this step and request to the government for reconsider it. Similarly, Tractor and their tool manufacturers are demanding for keep free from taxes this kind of things which are helpful and useful for farmers free from taxes.
What action will the government take, this will interesting to see. By the way, today is the first day of GST and congratulation to the Government for its successful application.
GST affect on Indian Automobile Sector
Let’s see GST(Goods and Service Tax) effect on Automobile Sector. There are very few things which can affect automobile sector directly, but a change in national taxation system will affect all the sectors very heavily.
Like all the sectors GST will responsible here too for some positive effects but all effects are not positive like all other sectors.
How GST will affect Car prices
New GST tax system will apply differently on the different segment of cars. Here are some data on comparison of the percentage of tax applied on cars segment wise before GST and after GST.
Like, you can see here cars other than ‘Hybrid’ segment will come with a less costly price tag. Hybrid cars like Camry Hybrid, Toyota Prius, Accord will have to face 13.3% more inclined taxation. In this info picture of AutocarIndia SUV segment is not described, because in pre-GST tax scenario SUVs consist of two separate duties based on ‘Ground-Clearance’, ‘Body Length’, and ‘Engine Capacity’. In GST too there is no different category.
But for your interest, we are informing you here some Indian favourite SUVs with new tax system like:
Scorpio, Fortuner, Tiguan, XUV 500 was bearing a heavy tax of 55.3% before GST, but GST will give them a bit of relief and in GST taxation system they’ll feel 12.3% lighter with 43% of total taxes.
In simple word, new car buyers will get more benefits than earlier car owners. If you think for a car with and that is not hybrid then you’ll thank to this new GST and you can spend somewhere else your money which has been saved by GST.
Because GST has changed all taxation system so there is a long list of benefits and cons based on the product. We’ll discuss new tax applied on different products like Bikes, Commercial Vehicles and agricultural vehicles.
For your kind information Bikes got not relief as Cars. If you are thinking of a simple bike or scooter for daily commuting then you can get those with a slightly less price but bikes which have more than 350 cc engine, their prices will see a bit of inclination of 0.8%. In next article, we will discuss on it briefly. Till then Take Care of Yourself. Do Not Drink And Drive.