GST Reforms India 2025: One of the big announcements made by PM Narendra Modi from the ramparts of the Red Fort is the Goods and Services Tax reform. After the announcement of the Goods and Services Tax reforms, the discussion of many goods and services becoming cheaper across the country has also started for a long time. PM Modi had said on the occasion of Independence Day that the work of implementing GST reform can be done in October before Diwali.

This is also being considered as a kind of Diwali gift for the general public. It is believed that this reform is likely to have an impact on the automobile sector. A big drop in the prices of vehicles is expected in this. If a report is to be believed, the price of small cars is expected to be reduced. The GST rate can be reduced from 28 per cent to 18 per cent. It means that the price of the vehicle can be reduced by up to per percentage.

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Which vehicles are included in the GST slab

Do you know that all vehicles running on petrol and diesel come under the GST?ab. These include passenger vehicles, two-wheelers, three-wheelers and commercial vehicles in the 28% GST slab. Electric vehicles are in the 5% slab, and hydrogen fuel cell vehicles are in the 12% slab. Compensation cess ranging from 0 to 22% is also imposed on cars.

The central government is now preparing to remove the 12% and 28% slabs and keep the 5% and 18% slabs. The vehicles of common customers will come in the 18% slab. A new 40% tax can be imposed on luxury vehicles. This tax reduction will directly reduce the ex-showroom price.

What did the auto expert say?

According to auto experts, customers can wait to buy vehicles now due to the possible reduction in prices. At the same time, this step is expected to prove very beneficial for the customers in the long run. Due to this, a decline in the prices of vehicles can be seen.

A popular entry-level car is expected to fall by up to Rs 36,000, and the best-selling bike by Rs 6,200. This is the reason why the initial sales of the festive season are expected to be somewhat slow. Along with this, according to SIAM data, between April and July 2025, passenger vehicle sales have declined by 0.7% and two-wheeler sales by 2.t.