Key highlights:

  • GST Council to increase the cess on mid-size, luxury cars and SUVs to 25%
  • This as the tax incidence will now be 53% from 43% GST + cess charged earlier
  • Larger cars contributes to 50-60% of the industry turnover

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The automobile industry is about to face the ugly side of the goods and service tax (GST) that has been recently rolled out. This as the GST Council on Monday announced their decision to increase the cess on mid-size, luxury cars and SUVs by 10% to 25% from the 15% currently in place.

While this is yet to be implemented as it would have be amended in the GST Act, the decision is expected to see a rise in prices of these passenger vehicles. Except for small cars, all cars above 4 meters could see their prices go much above the pre-GST levels due to the hike in the on-road taxes in many states.

Luxury car makers voice disappointment over GST Council's increase in cess

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