Maruti Suzuki, the foremost car seller in India, achieved a significant milestone on the inaugural day of Navratri, selling approximately 30,000 cars across the country. In addition to these impressive sales figures, the company reported receiving around 80,000 inquiries, which signals strong consumer interest in their products. The surge in sales comes in the wake of recent adjustments to the Goods and Services Tax (GST) rates, leading to price reductions across numerous car models. Maruti Suzuki had previously announced price cuts, with the intention of passing the benefits of the GST changes on to their customers. The entry-level Alto K10, for instance, is now available at ₹3,69,900, reflecting a price reduction of ₹1,07,600. Similarly, the Grand Vitara experienced a similar price decrease and is now priced at ₹10,76,500. The government’s revision of GST rates, effective from September 4, 2025, represents the most comprehensive tax reforms since the implementation of GST on July 1, 2017. These reforms streamlined the tax structure by reducing the number of tax slabs from four (5%, 12%, 18%, and 28%) to just two (5% and 18%). Under the revised GST structure, cars are categorized based on length, engine size, and fuel type. Small cars, which are defined as those under 4 meters in length, with petrol engines below 1,200cc, or diesel engines below 1,500cc, are subject to an 18% GST. Large or luxury cars, exceeding 4 meters in length, or with engines that surpass the defined capacities, are taxed at 40%. Hybrid vehicles are taxed under the same conditions as large cars, while electric vehicles continue to benefit from the 5% GST rate. As the largest car manufacturer in India, Maruti Suzuki is expected to be a major beneficiary of these changes, as their sales primarily involve small cars. However, it is crucial that vehicles meet all the requirements to qualify for the lower tax bracket. For example, despite the Jimny being under 4 meters, its 1.5-liter petrol engine places it in the 40% tax bracket. Similarly, the Ertiga, while featuring a 1,198cc engine, is 4.3 meters in length and is also subject to the 40% GST. Vehicles failing to meet any single criterion are placed in the higher tax bracket.
