GST Rate Cut: Honda, Jeep Announce Price Reductions Across Bikes & Cars; Details Here | Business News

With vehicle prices set to drop just ahead of the festive season, automakers are hoping for a demand revival.

Honda Cars India and Jeep India on Tuesday announced price cuts across their product lines to pass on the benefit of the recent GST rate reduction. The revised prices will take effect from September 22, when the new tax slabs kick in.

Honda Cars India said the compact sedan Amaze will become cheaper by up to Rs 95,500, the City by Rs 57,500, and the Elevate by Rs 58,400. Jeep India also announced sharp reductions ranging from Rs 1.26 lakh to nearly Rs 4.8 lakh across its portfolio, including the Compass, Meridian, Wrangler and Grand Cherokee.

Honda Motorcycle and Scooter India (HMSI) separately said it will cut prices of its models up to 350cc by as much as Rs 18,800. “The reduction in GST on two-wheelers and spare parts is a timely and forward-looking step, making vehicles more affordable and strengthening the overall ecosystem,” said Yogesh Mathur, Director, Sales and Marketing, HMSI.

Honda and Jeep’s announcements follow similar moves by other automobile companies earlier this month. Two-wheeler makers Hero MotoCorp, TVS Motor Company and Yamaha had already slashed prices, with benefits ranging from Rs 15,743 to Rs 17,581 on motorcycles and scooters. Car makers including Tata Motors, Mahindra & Mahindra, Hyundai and Renault India also confirmed price cuts soon after the GST Council’s decision.

With vehicle prices set to drop just ahead of the festive season, automakers are hoping for a demand revival. Analysts say the cuts will improve affordability, particularly in entry-level segments, and may help lift sales volumes in an otherwise cautious market.

What the GST Council Changed

In its 56th meeting last week, the GST Council reduced tax rates on several categories of vehicles:

Two-wheelers up to 350cc now attract 18% GST instead of 28%. Premium bikes above 350cc, such as Royal Enfield 650cc and Harley-Davidson models, are taxed at 40%.

Small cars — petrol/CNG/LPG models up to 1200cc and 4000 mm length, and diesel cars up to 1500cc and 4000 mm length — now fall under 18% GST, down from 28%.

Larger cars and SUVs with higher engine capacity or longer length are taxed at 40%, compared with the earlier effective rate of 45-50% (28% GST plus compensation cess).

The revised GST rates take effect from September 22, 2025.