The new GST rates are set to bring significant relief to the middle class, particularly those looking to purchase vehicles. The government has made changes that will reduce prices across various vehicle categories, including trucks and e-rickshaws. The GST on several vehicles and auto parts has been reduced from 28% to 18%, effective September 22nd, with benefits extending to consumers and logistics companies.
Tires are among the items seeing a tax reduction. New rubber pneumatic tires, excluding those used on bicycles, rickshaws, and aircraft, will now have an 18% GST rate, down from 28%. This will lead to lower maintenance costs. Vehicles used for transporting goods also see a reduction to an 18% GST rate. Buses, trucks, and ambulances are included in this tax relief.
Road tractors designed to pull semi-trailers, with engines exceeding 1800cc, will be subject to an 18% tax. This is expected to ease costs for the logistics and transportation sectors.
For families, vehicles with smaller engines are set to become more affordable. This includes petrol, CNG, and LPG-powered cars with engines up to 1200cc and a length of 4 meters or less. Diesel cars with engines up to 1500cc and a length under 4 meters also qualify for the lower GST slab. Hatchbacks and compact cars will now have an 18% tax rate, down from 28%.
Three-wheeler vehicles and motorcycles (up to 350cc, including scooters and mopeds) will become more affordable, benefiting families in smaller cities and towns.
Ambulances, which come factory-equipped with necessary medical fittings, will also have reduced taxes. This should positively impact the healthcare sector and potentially lead to more affordable ambulance services. Hybrid vehicles (petrol-diesel + electric motor) are also included, potentially lowering the future cost of eco-friendly vehicles. Both types of compact hybrid cars will be taxed at 18%.
