BR Bureau
The Union Government has announced significant GST rate reductions across key heavy industries, aiming to stimulate demand, investment, and job creation.
In the automobile sector, GST on two-wheelers up to 350cc has been slashed from 28% to 18%, making bikes more affordable for rural and semi-urban households. Small cars will now attract 18% GST (down from 28%), while large cars face a simplified 40% flat rate with cess removal. Tractors under 1800cc will be taxed at 5%, while buses and commercial vehicles see rates drop to 18%, reducing costs for fleet operators and logistics firms.
Auto components too will now be taxed at 18%, supporting MSMEs and ancillary industries. Experts expect cheaper vehicles, improved rural mobility, lower freight costs, and new job opportunities, aligning with the government’s push for Make in India, cleaner mobility, and logistics efficiency.
