GST
GST rates after GST 2.0: cars, bikes, phones, TVs and gold
Since 22 September 2025, GST in India mostly uses two rates, 5% and 18%, with 40% for luxury and sin goods. Small cars, bikes up to 350cc, TVs and ACs moved down from 28% to 18%. Gold stays at 3%.
New rates on common purchases
| Item | Before GST 2.0 | Now |
|---|---|---|
| Small car (petrol up to 1,200cc, diesel up to 1,500cc, under 4 m) | 28% + cess | 18% |
| Large cars and luxury cars | 28% + up to 22% cess | 40% |
| Motorcycle up to 350cc | 28% | 18% |
| Motorcycle above 350cc | 28% + cess | 40% |
| TVs and air conditioners | 28% | 18% |
| Mobile phones | 18% | 18% (no change) |
| Gold and gold jewellery | 3% | 3% (no change) |
| Individual health and life insurance | 18% | 0% (exempt) |
| Cement | 28% | 18% |
| Butter and ghee | 12% | 5% |
What it means in rupees
For a small car with a pre-tax price of ₹6 lakh:
- Before: 28% GST plus 1% cess came to ₹1,74,000, so the car cost ₹7,74,000.
- Now: 18% GST is ₹1,08,000, so the car costs ₹7,08,000.
That saves ₹66,000 before registration and insurance. A TV priced at ₹40,000 before tax now costs ₹47,200 instead of ₹51,200. A 125cc bike priced at ₹1 lakh before tax costs ₹1,18,000 instead of ₹1,28,000.
Gold: what the 3% covers
The 3% GST applies to the value of the gold. Jewellers usually show making charges separately, and those carry their own GST. Always ask for a bill that breaks down the gold value, making charges and tax.
Insurance is now cheaper
Individual health and term life policies no longer carry GST. A ₹25,000 health insurance premium that used to cost ₹29,500 with 18% GST now costs ₹25,000.
How to check the GST on any bill
For a GST-inclusive price, divide by 1.18 (for 18%) or 1.05 (for 5%) to find the pre-tax amount. The difference is the GST. Within your own state, the bill splits it equally into CGST and SGST.
Add or remove GST from any price
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