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GST of 31 percent on motorcycles over 350cc

22nd May 2017 4:39 pm

Big bikes will pay GST of 28 percent plus 3 percent cess, the same as private aircraft and luxury yachts.

As per the Goods and Services Tax (GST) guidelines, motorcycles with engine capacities greater than 350cc will attract a total tax rate of 31 percent – 28 percent GST along with a 3 percent cess. Motorcycles and mopeds, as a category, will attract a peak GST of 28 percent.

The total tax rate of 31 percent for high-capacity motorcycles puts them in the same bracket as private aircraft and luxury yachts. The introduction of GST will not make big bikes any cheaper than they currently are, considering that the tax rates are more or less similar to the current total indirect tax rates applicable.

The cost of ownership of motorcycles is also likely to go up, due to the proposed 28 percent rate for auto components and the possible hike in the tax rate for services from 15 to 18 percent.

Motorcycle manufacturers, however, have still not commented on the proposed GST rates, stating that they are still trying to figure out the impact it'll have on pricing and sales. 

Also read: GST: Luxury cars, SUVs to be cheaper; hybrids will cost more

 
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