The Goods and Service Tax or GST, will come into effect from July 1, 2017 and it will not only affect the prices of commodities that you buy on a daily basis, it will also change the prices of the bikes in India. We take a look at how the new tax bill will affect motorcycle prices and if it is advisable to wait till the new bill rolls out or go for it in the next few hours.
What does the GST bill say?
Under GST, most of the two-wheelers will attract a tax rate of 28 per cent, lower than total tax incidence of around 30 per cent at present. Motorcycles with engine capacity of over 350 cc, however, will attract an additional cess of three per cent.
TVS Apache RTR 160
Discounts on offer
Two-wheeler makers TVS Motor Company and Royal Enfield have become the latest to pass on expected benefit of GST to customers by lowering prices of their vehicles.
Niche bike maker Royal Enfield has reduced prices of its models by up to Rs 2,300 (on-road Chennai) while TVS Motors did not disclose quantum of price cut on its product portfolio.
Bajaj Auto and UM Lohia Two Wheelers have announced a reduction in prices of their motorcycles to pass on the expected benefits of GST to customers.
Bajaj has reduced prices of its motorcycles from CT 100 to Dominar 400 by up to Rs 4,500 while UM Lohia Two Wheelers has cut prices of its two models by up to Rs 5,700.
Honda CB Hornet 160R
How does it affect you?
As per the new GST bill, you won’t have to pay for all the unnecessary taxes like- excise duty, VAT, CST and so on and so forth. This could turn out to be a boon for the customers as you will be able to buy a new motorcycle under one tax slab all over the country. This is good news for people living in Maharashtra, Gujarat and Karnataka, where the state taxes are the highest.
However, the picture will only be clear once the actual bill is rolled out. Bike-makers will most likely announce the revised prices on or before July 1, when the bill is actually announced.