Key highlights:

  • Union Cabinet approves Finance Ministry proposal to increase GST cess on luxury cars
  • Luxury cars, SUVs, larger passenger cars to incur GST cess of 25% from 15%
  • Jaitley said that the GST Council will decide on actual increase in duties

COMMERCIAL BREAK
SCROLL TO CONTINUE READING

The Union Cabinet has given its approval to the Finance Ministry proposal for increasing the goods and service tax (GST) cess for larger passenger vehicles to 25% from the current 15% cess. This means that the prices of luxury cars, SUVs and other cars larger than 4 meters are set to rise due to the increase in taxes.

The government in a statement said, “The Union Cabinet chaired by Prime Minister Narendra Modi has given its approval to the proposal of the Finance Ministry to promulgate an ordinance to suitably amend the Goods and Services Tax (Compensation to States) Act, 2017. The approval would allow to increase the maximum rate at which the Compensation Cess can be levied from 15% to 25% on: a) motor vehicles for transport of not more than thirteen persons, including the driver; and b) motor vehicles falling under headings 8703.”

Luxury car makers voice disappointment over GST Council's increase in cess

  • SUVs, luxury cars to get expensive as GST Council recommends hike in cess to 25%

    •