The Union Finance Minister Nirmala Sitharaman’ has issued a new definition of Small SUVs that will now be applicable across India. Currently, SUV cars in India are being taxed at the rate of 20 to 22 percent. Now according to the GST council, cars that have an engine capacity of more than 1,500cc, length of 4,000 mm, & ground clearance of more than 170 mm will be classified as SUVs. The vehicles that don’t come under this purview can expect tax reductions on them.
It has been recommended to reduce the GST rates of many items (including many SUVs available in the country) to 5% or 0% in the recent GST council meeting.
The 20 to 22 percent GST is not even half of the taxes that apply to cars outside the purview mentioned above. Excise duty, VAT, road tax, motor vehicle tax, and GST combined puts almost 50% tax on these cars. However, the cars under this purview only get a GST tax rate of 5% or less. This is good news for those people who are thinking of buying small or compact SUVs.
Popular compact SUVs like Tata Nexon, Hyundai Venue, Kia Sonet, Maruti Suzuki Brezza, and Mahindra XUV300 could become cheaper because of the new GST tax rates.
Maruti Suzuki Brezza
is powered by a 1,462cc petrol engine and its length measures 3,995mm. The ground clearance of the Brezza is 200mm.
Hyundai Venue
is powered by a 1,493cc diesel engine and two petrol engines of 998cc and 1,197cc. The length of the Venue is 3,995mm and the ground clearance is 190-195mm. The Kia Sonet engine options and length is the same as the Hyundai Venue.
Tata Nexon
is powered by a 1,497cc diesel engine and a 1,199cc petrol engine. Nexon length is 3,993mm and the ground clearance is 209mm.
Mahindra XUV300
is powered by a 1,497cc diesel engine and a 1,199cc petrol engine. XUV300 has a length of 3,995mm and the ground clearance is 180mm.
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