Maruti Suzuki, a leading automobile manufacturer in India, celebrated the commencement of Navratri with remarkable sales figures. On the first day of the festival, the company successfully sold around 30,000 cars across the nation. In addition to the impressive sales numbers, Maruti Suzuki also recorded approximately 80,000 inquiries, indicating strong customer interest and demand. The surge in sales is attributed to the recent implementation of revised Goods and Services Tax (GST) rates, which have led to price reductions for various car models. Maruti Suzuki had previously announced price cuts to ensure that customers could take advantage of the GST adjustments. For example, the Alto K10, a popular entry-level model, is now available at ₹3,69,900, with a price reduction of ₹1,07,600. The Grand Vitara also saw a price decrease of the same amount, now priced at ₹10,76,500. The government’s decision to revise GST rates on September 4, 2025, represents the most significant tax reforms since the inception of GST on July 1, 2017. The reform streamlined the tax structure by reducing the number of tax slabs from four (5%, 12%, 18%, and 28%) to just two (5% and 18%). The new GST structure categorizes cars based on factors such as length, engine capacity, and fuel type. Small cars, which are defined as vehicles less than 4 meters in length with petrol engines under 1,200cc or diesel engines under 1,500cc, are subject to an 18% GST. On the other hand, large or luxury cars, which exceed 4 meters in length or have larger engines, are subject to a 40% GST. Hybrid cars are taxed the same as large cars, while electric cars continue to enjoy a lower 5% GST rate. As India’s largest car manufacturer, Maruti Suzuki is set to benefit significantly from these changes because of its focus on the small car market. However, it is important that a vehicle meets all the criteria to qualify for the lower tax bracket. For example, the Jimny, while under 4 meters, has a 1.5-liter petrol engine and therefore falls into the 40% tax slab. Similarly, the Ertiga, though it has an engine of 1,198cc, is 4.3 meters long, putting it in the 40% GST bracket. Failing to meet even one criterion will result in the vehicle being subject to the higher tax rate.
