From Swift to XUV700, Innova and More: Car Prices to Drop Under GST 2.0
Car prices in India to drop under GST 2.0! From Maruti Swift and Brezza to Hyundai Creta, Mahindra XUV700, and Toyota Innova, check expected price cuts up to 9%.
Popular cars like Maruti Swift, Hyundai Creta, Mahindra XUV700, and Toyota Innova Crysta are set to get cheaper under GST 2.0 with price cuts up to 9%.
Indian car buyers are in for a festive-season delight as the government’s GST 2.0 reform brings down prices across all car segments — from small hatchbacks to premium SUVs and MPVs.
According to industry estimates, prices could fall by as much as 9%, depending on the model and category. The restructuring has simplified the tax structure by eliminating the earlier compensation cess and placing all internal combustion engine (ICE) cars into two clear slabs — 18% and 40% GST.
How Popular Models Will Get Cheaper
- Maruti Suzuki WagonR: Could see an 8.6% cut, with its base variant dropping to around ₹5.29 lakh (ex-showroom).
- Maruti Suzuki Swift: Expected to fall to ₹5.93 lakh (ex-showroom).
- Maruti Suzuki Dzire: Likely to start at ₹6.25 lakh (ex-showroom).
- Hyundai Creta, Maruti Suzuki Brezza, Volkswagen Virtus: Prices may fall by 3.6%, with revised base variant prices at ₹10.71 lakh, ₹8.37 lakh, and ₹11.14 lakh, respectively.
- Mahindra XUV700: Could see a 6.8% drop, with prices starting at ₹13.51 lakh (ex-showroom).
- Toyota Innova Crysta: Expected to begin at ₹18.64 lakh (ex-showroom) post-reduction.
(Data source: Crisil Intelligence)
What Changed in GST 2.0?
Earlier, all ICE cars attracted 28% GST plus a compensation cess of 1%–22%, depending on engine size and vehicle category. This pushed effective taxation on some cars to nearly 50%, making Indian cars more expensive compared to global markets.
Under GST 2.0, the cess has been scrapped, leaving just two simplified slabs:
- 18% slab: For smaller cars like hatchbacks, compact sedans, and compact SUVs.
- 40% slab: For mid-size, large, and luxury cars.
Meanwhile, electric vehicles (EVs) continue under the 5% GST slab, and hydrogen fuel cell vehicles (FCEVs) have been shifted from 12% to 5%, further boosting green mobility.
Industry Outlook
Auto experts believe this move could boost car sales during the festive season, aligning Indian car prices closer to global benchmarks. While the government may lose some revenue from reduced tax collections, industry players expect stronger demand to balance the impact.
