GST : Centre to hike cess on SUVs, luxury cars from 15% to 25%

The Goods and Services Tax Council has authorised the Centre to raise the cess on SUVs and luxury cars from 15% to up to 25%, the finance ministry said on Monday.

“GST Council in its 20th Meeting held on 5th Aug, 2017 considered the issue that total tax incidence on motor vehicles after GST has come down. It recommended that Central Govt may move legislative amendments to increase max ceiling of cess on motor vehicles to 25% from present 15%,” the finance ministry tweeted.

“However, the decision on when to raise the actual cess leviable on the motor vehicles will be taken by the GST Council in due course,” it added.Large motor vehicles, SUVs, mid-segment cars, large cars, hybrid cars and hybrid motor vehicles attracted a cess of 15% in addition to the GST rate of 28%, according to the council’s earlier decision. Small petrol cars attract a cess of 1%, while small diesel cars attract a cess of 3%, besides the 28% GST rate.