• Notification Date: 27-12-2024
• Notification No: N/A

GST council decided to standardize used cars' tax rate to 18%

The GST Council has clarified that no new tax will be levied on old or used cars. Instead, the Council has simplified the structure of tax by introducing a uniform GST rate of 18% on the sale of all used vehicles, including electric vehicles.

Earlier, those vehicles powered by petrol, LPG, or CNG with 1200cc engine size and length more than 4000mm were charged an 18% GST rate. Under the new regime, this rate will apply uniformly to all used vehicles irrespective of the type and size of the engine.

According to experts, the recently convened meet brought about no fresh levies on used car imports. The move forms a part of the GST regime simplification and rationalization process. This uniform taxation rate on used cars, including EVs, is said to give greater clarity and uniformity to the market.

The decision is expected to simplify the buying and selling process of old vehicles, and it would be interesting to see what it has to say for the industry over the long term.