Prices of SUVs and MPVs to go up 2% following the GST cess increase

economictimes.indiatimes.com:

GST Council increasing the cess by 200 basis points from the current 20 per cent to 22 per cent. Under the current GST structure, bigger UVs are levied with GST rate of 28 per cent and cess up to 22 per cent. The hybrid UV has a cess rate of 15 per cent, followed by two cess slabs of 20per cent and 22per cent respectively. With the change in GST rate of bigger UVs (either petrol or diesel) will be levied with the highest cess rate of 22 per cent if a vehicle meets any of the following three specifications—first, unladen (without passenger weight) ground clearance of 170mm-- earlier this condition was on laden basis (with passenger weight), it is now unladen, second length more than 4 meter and lastly, over 1500cc engine capacity. In addition, the condition popularly known as SUV has also been removed. This would mean all bigger SUV/MPV which are attracting 20 per cent cess rate so far will have cess rate of 22 per cent. This would mean SUV/MPV prices are likely to increase by 2per cent. It’s not immediately clear which UV models would attract a higher cess as the specification published in the company’s sale brochure is different from the specification during the vehicle homologation. Homologation is a government issued certificate that allows a product to enter a market. The GST council goes with specification shared by the manufacturer during homologation.

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