Latest GST Council Update - Automobiles Made Affordable (Effective from September 22, 2025)
The GST Council has reduced GST rates on several categories of automobiles, lowering them from 28% to 18%. This change is expected to make mass-market cars, two-wheelers, and goods vehicles more affordable for consumers and businesses.
Key GST Reductions in Automobiles
Petrol & Petrol Hybrid, LPG, CNG Cars
(not exceeding 1200cc & 4000mm) - 28% to 18%
Diesel & Diesel Hybrid Cars
(not exceeding 1500cc & 4000mm) - 28% to 18%
3-Wheeled Vehicles - 28% to 18%
Motorcycles (≤ 350cc) - 28% to 18%
Motor Vehicles for transport of goods - 28% to 18%
Summary
- All small and mid-segment cars (petrol, diesel, CNG, LPG, hybrids) now taxed at 18% GST instead of 28%.
- 3-wheelers, motorcycles up to 350cc, and goods vehicles also shifted to the 18% slab.
- This move aims to boost demand in the automobile sector, encourage affordable mobility, and reduce transportation costs.
