GST on Bikes – Know the GST Impact on 2-Wheelers and Bikes in India


4 min read

Updated on Oct 27, 2022

Visual Stories by PayBima

GST Impact on Two-wheelers Prices in India

Did you know that ever since GST was introduced in India, the majority of the sectors have only seen benefits? Oh yes, you read that right! And one of those sectors is the two-wheeler industry. Prior to the GST era, the tax rate was 30%. And after GST was brought into the picture, the tax rate went to 28% for two-wheeler. However, the engine capacity has to be lesser than 350 cc. The GST on bikes with an engine capacity of more than 350 cc is 31%.

The prices of many bikes have fallen, and one of those is Royal Enfield, which came down by INR 7,000. However, you must be aware of the fact that the price of a two-wheeler depends heavily on the model and the place where it is bought. The bikes with more than 350 cc also have seen their prices being affected. The on-road price fell after GST on two-wheelers was introduced, which benefited a lot of customers.

Here is a Quick Peek into the GST Rates that Affect the Two-Wheeler and Component Costs.

  • Two-Wheeler Insurance: The GST rate is 18%
  • Gauge Oil Level, Brake Pads, and Clutch Cable: The rate of GST is 28%
  • Battery Charging, Consumables, and Lubricants: The GST rate is 18%
  • Two-Wheelers – Engine Capacity more than 350 CC: The GST rate is 31%
  • Two-Wheelers – Engine Capacity less than 350 CC: The GST rate would be 28%

GST Impact on Top 10 Indian Bikes Prices

Here are some of the popular vehicles with their displacement and how the rates have changed based on the new GST rate that has been introduced.

1. Hero HF Deluxe

Before the GST was introduced, the ex-showroom price of Hero HF Deluxe was INR 42,830 in Delhi.  The displacement is 97.2 cc. The bike GST rate has now been reduced by 3%-5%. As the GST came into effect, the revised ex-showroom price of the two-wheeler was INR 41,545.

2. Hero Splendor

Hero Splendor has always been one of the most sought-after bikes in India. This bike falls into the affordable category and is well within almost everybody’s budget.  The ex-showroom price of the bike before GST was INR 48,280 in Delhi. As the displacement of Hero Splendor is 97.2 cc, the price has been reduced to 3%-5% and after GST it came down to INR 46,349.

3. Hero Glamour

The displacement of this bike is 124,7 cc and the ex-showroom price in Delhi was INR 56,655. Post GST, the price was reduced to 3%-5% and the new ex-showroom price became INR 54,389.

4. Hero Passion

Before the implementation of GST, the ex-showroom price of Hero Passion was INR 52,605 in the capital city of the country. The engine capacity of the bike is 97,2 cc. The bike falls under the beneficiary segment and the ex-showroom price of the bike after GST came down to INR 49,974.

5. Honda Dream Yuga

The displacement of the Honda Dream Yuga is 124.7 cc, and the ex-showroom price of this bike was INR 51,977 before GST. The price of this two-wheeler became around INR 50,418 after GST was introduced.

6. Honda CB Shine

The engine capacity of the Honda CB Shine is 124.7cc and the price used to be INR 56,268 before GST. Post GST, the ex-showroom price of the bike was revised and it became around INR 53,736.

7. Bajaj Platina

Bajaj Platina comes with a 100cc displacement. Before GST came into effect, the ex-showroom price of the bike used to be  INR 45,985. After GST was brought in, the ex-showroom price was reduced to 3%-5% and became INR 44,606.

8. Honda CB Unicorn 150

The engine capacity of the Honda CB Unicorn 150 is 149.1 cc and the ex-showroom price used to be INR 70,503 pre-GST. After GST, the price became INR 68,388.

9. Royal Enfield Classic 350

The displacement of the Royal Enfield Classic 350  is 346 cc. Before, GST the ex-showroom price was INR 1,34,919. After GST, the ex-showroom price was INR 1,30,197.

10. Bajaj Pulsar

With a displacement of Bajaj Pulsar of 220 cc, the ex-showroom price of this two-wheeler used to be INR 92,000. Post-GST, the ex-showroom price became INR 88,512.

Also Read: How Does GST Impact Your Insurance Premium?

GST on Two-Wheelers in 2022

GST on two-wheelers is determined by the engine capacity of the bike or scooter. Currently, bikes that are under 350cc are at a 28% tax rate. If the engine capacity of the bike exceeds 350 cc, a 3% compensation cess is added to the basic rate, which effectively leads to a 31% tax rate. For a clearer picture, you can keep reading.

  • If you are buying a Hero Splendor bike, the GST charged on the value of the motorbike will be 28%.
  • The same is for Honda Unicorn since these bikes are lesser than 350cc.
  • If you are buying a Royal Enfield bike that comes with more than 350 cc, the GST charged will be 31% on the value of your bike.

The minimum GST on the common bikes charged is 28% and the higher rate of GST charged is 31%. Furthermore, an 18% GST rate is charged on items such as consumables, lubricants, and battery charging. The GST rate charged on spare parts such as gauge oil level and clutch cable is 28%.

The sudden change in the already high GST rate may affect the demand for two-wheelers having implications throughout the automobile industry. Those who already own a two-wheeler or even planning to purchase one can still save some money by comparing bike insurance policies online and getting great deals on two-wheeler insurance.

Apr 18, 2022
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PayBima Team
PayBima is an Indian insurance aggregator on a mission to make insurance simple for people. PayBima is the Digital arm of the already established and trusted Mahindra Insurance Brokers Ltd., a reputed name in the insurance broking industry with 17 years of experience. PayBima promises you the easy-to-access online platform to buy insurance policies, and also extend their unrelented assistance with all your policy related queries and services.

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