This September, India witnessed a significant overhaul of GST in the auto sector—slashing complex, high tax slabs and replacing them with a more consumer-friendly structure. From the dated 28% GST plus hefty cess to a streamlined 40% rate for SUVs and premium vehicles, this reform is set to bring much-needed relief to car buyers.
The GST Council has introduced a simplified three-tier tax system:
- 5%: Electric vehicles & essentials remain low-taxed.
- 18%: Small cars (≤1,200 cc petrol; ≤1,500 cc diesel; ≤4 m length) along with two/three-wheelers and auto parts.
- 40%: Larger SUVs, luxury vehicles, MPVs—all without cess.
This replaces the older system that stacked up to 50% in tax for premium vehicles.
| Quick Comparison Snapshot | |||
| Model | Previous Tax Burden | New GST Rate | Estimated Savings |
| XUV700 | 48% | 40% | ~6.7% drop |
| CRETA | 48% | 40% | ≥ ₹1 lakh (~6–7%) |
| SCORPIO N | 48% | 40% | Similar to Creta/XUV700 |
What It Means for SUV Buyers
- Hyundai Creta: From ~50% total tax to 40%, buyers can save ₹1 lakh or more.
- Mahindra XUV700: Similar to Creta, its premium SUV tag carries ~6.7% worth of tax savings.
- Scorpio‑N: As a larger SUV, it likely falls into the 40% slab — offering solid potential savings like its peers.
Why This Matters
This reform isn’t just about lower tax rates; it’s about:
- Greater affordability: Breaking down the cost barrier to SUVs
- Fairer pricing: Eliminating opaque cess and simplifying purchase decisions
- Boosted demand: Encouraging buyers, especially in the premium segment, to make the leap
However, note that dealerships still need to clear older inventory taxed at the higher slabs, making this a transitional shift.
What This Means for Selected SUVs
1. Mahindra XUV700 – Premium SUV (Luxury/Premium segment)
Previously taxed around 45–50% (GST + cess), the XUV700 now benefits from the flat 40% GST slab.
Crisil estimates suggest a price drop of around 6.7% for premium SUVs like this under the new regime.
2. Hyundai Creta – Mid-sized/Compact SUV
Previously burdened by GST plus cess (total ~48%), the Creta now attracts just 40% GST, shaving off about 8%. This results in savings of ₹1 lakh or more on the on-road price
3.Scorpio‑N – Upcoming SUV (assuming typical engine/size)
While detailed figures aren’t yet available, the Scorpio‑N will likely fall under the 40% slab — just like other SUVs above 1,500 cc or 4 m length. Expect a similar benefit to Creta and XUV700, with a potential reduction in the tax-laden portion of the price.
Conclusion
Wondering if now is the time to buy? With SUVs like the Creta and XUV700 becoming notably cheaper, and Scorpio‑N likely following suit, there’s never been a better moment to explore your options. Stay tuned for detailed price breakdowns ,let this GST overhaul drive your smarter buying decision.