The Goods and Services Tax (GST) reforms introduced in September 2025 reshape India’s tax system with rate cuts in sectors like education, automobiles, technology, and many others.

The changes aim to lower costs, boost competitiveness, and drive inclusive growth of the next generation. Notably, higher automobile sales are expected to create multiplier effects across the economy, benefiting manufacturers, dealerships, service providers, drivers, and auto-finance companies.

Under the new GST reforms, the tax on small cars has been reduced from 28 percent to 18 percent. This category includes petrol cars with engines below 1,200 cc and a length under 4 meters, and diesel cars with engines below 1,500 cc and a length under 4 meters.

Two-wheelers above 350cc and larger cars are now subject t

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