GST in Automobile Industry of India

The introduction of Goods and Services Tax (GST) is expected to stimulate the India’s growth. It has been discussed that GST is a simplified tax system to apply a single tax system, which was distributed in multiple sections earlier. According to the reports of EY, the removal of VAT and separate state incentives is to benefit the customers by their removal as well as introduction of integrated GST (EY, 2015). However, the taxes levied on luxury cars and small cars will be different as per the classifications of the cars. But, GST has already influenced the existing market of automobiles widely with expectations to help the customers. It has been also seen that before July 1, the prices of cars have slashed. The reason is the pre-GST discounts given in the luxurious models of cars in the Indian assembled models (BT Economy, 2017). The huge inventory of the dealers forced them to cut the prices of the automobiles in the Indian market. The intentions of GST are to minimise the high taxes and make sure stable tax rates levied on the products and services for the customers. For example, the customers will be paying less tax after the introduction of GST. It can be interpreted that the introduction of GST will cut the tax burden of the consumers. Hence, the introduction of GST is supposed to help the customers in the Indian market.



  1. BT Economy. (2017). Planning to buy a car? Here’s how much you can save with pre-GST discount. Retrieved from BT India:
  2. (2015, December). Hello GST: impact on the auto industry. Retrieved from EY Published Editorials:

One thought on “GST in Automobile Industry of India

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  1. Thanks for sharing the links. GST look quite cumbersome but what I understand that a flat tax will be applied across all states and the national level to chuck out various tax rates in the different states.


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