What is the GST rate on cars in India after GST 2.0?

Small cars (petrol up to 1200cc, diesel up to 1500cc, length up to 4000mm) attract 18% GST under GST 2.0, reduced from 28%. Larger cars and SUVs attract 18% GST plus compensation cess. Luxury cars attract 18% plus higher cess. The cess has been abolished for small cars.

What is the GST rate on motorcycles and scooters?

Motorcycles and scooters up to 350cc attract 18% GST under GST 2.0, reduced from 28%. Motorcycles above 350cc attract 18% plus compensation cess. Electric two-wheelers attract just 5% GST.

What is the GST rate on electric vehicles?

Electric vehicles (EVs) attract 5% GST — significantly lower than the 18% on petrol/diesel vehicles. This applies to electric two-wheelers, three-wheelers, and four-wheelers. The 5% rate is a policy incentive to promote EV adoption.

Can a business claim ITC on a car purchase?

Generally, ITC on motor vehicles is blocked under Section 17(5) of the CGST Act for personal use. However, ITC is available if the vehicle is used for: (1) further supply of vehicles (car dealers), (2) transportation of passengers (taxi operators), (3) imparting driving training, or (4) transportation of goods.

What is the GST rate on auto parts and accessories?

Auto parts and accessories attract 18% GST. HSN code 8708. This includes engine parts, body parts, electrical components, and accessories. Tyres attract 28% GST (not reduced under GST 2.0).

What is the GST rate on cars in India after GST 2.0?

Small cars (petrol up to 1200cc, diesel up to 1500cc, length up to 4000mm) attract 18% GST under GST 2.0, reduced from 28%. Larger cars and SUVs attract 18% GST plus compensation cess. Luxury cars attract 18% plus higher cess. The cess has been abolished for small cars.

What is the GST rate on motorcycles and scooters?

Motorcycles and scooters up to 350cc attract 18% GST under GST 2.0, reduced from 28%. Motorcycles above 350cc attract 18% plus compensation cess. Electric two-wheelers attract just 5% GST.

What is the GST rate on electric vehicles?

Electric vehicles (EVs) attract 5% GST — significantly lower than the 18% on petrol/diesel vehicles. This applies to electric two-wheelers, three-wheelers, and four-wheelers. The 5% rate is a policy incentive to promote EV adoption.

Can a business claim ITC on a car purchase?

Generally, ITC on motor vehicles is blocked under Section 17(5) of the CGST Act for personal use. However, ITC is available if the vehicle is used for: (1) further supply of vehicles (car dealers), (2) transportation of passengers (taxi operators), (3) imparting driving training, or (4) transportation of goods.

What is the GST rate on auto parts and accessories?

Auto parts and accessories attract 18% GST. HSN code 8708. This includes engine parts, body parts, electrical components, and accessories. Tyres attract 28% GST (not reduced under GST 2.0).

GST Rate Finder

GST Rates · Automobiles

GST 2.0 Updated

GST Rates on Automobiles

GST rates on automobiles in India 2026. GST 2.0 reduced small cars and motorcycles from 28% to 18% and abolished the cess on small vehicles. Electric vehicles continue at 5%.

At 18% GST

GST 2.0 — Effective September 22, 2025

Small cars (≤1200cc petrol, ≤1500cc diesel): 18% (down from 28% + cess). Motorcycles ≤350cc: 18% (down from 28%). Cess abolished on small vehicles. EVs unchanged at 5%.

The automobile sector saw dramatic changes under GST 2.0 (September 22, 2025). Small cars (petrol up to 1200cc, diesel up to 1500cc) and motorcycles up to 350cc were reduced from 28% to 18%, with the compensation cess abolished for small vehicles. This makes entry-level cars and bikes significantly more affordable. Electric vehicles continue to attract just 5% GST as a policy incentive. Luxury cars and large SUVs now attract 18% plus cess, but the effective rate is still lower than the old 28% + 20–22% cess structure.

All Automobiles — GST Rates and HSN Codes

Product / Service	HSN Code	GST Rate	Notes
Cars (Petrol/Diesel)	8703	18% GST	Small cars: 18% (reduced from 28%). Large cars: 18% + cess. Luxury cars: 18% + higher cess.
Motorcycles and Scooters	8711	18% GST	Up to 350cc: 18% (reduced from 28%). Above 350cc: 18% + cess.
Auto Parts and Accessories	8708	18% GST	Auto parts and accessories attract 18% GST.