GST impact on two-wheelers: Bikes and scooters of Hero MotoCorp, Yamaha go cheaper

Scooters and bikes attract 28% tax under GST, while there is an additional cess of 3% for bikes with 350cc and above engines.

The two-wheeler makers in India are ushering in the Goods and Services Tax (GST) by revising product prices. Some two-wheeler makers have announced the price revision before the GST rollout. Now, Yamaha and Hero MotoCorp have joined the list.

Under GST, the tax rate of the scooters and bikes with less than 350cc engine capacity attract 28 percent of tax while bikes above 350cc engine get an additional cess of three percent, making the latter slightly expensive than the previous tax incidence.

Yamaha India GST price cut

Yamaha has announced new prices across its range to pass on the benefits of Goods and Service Tax (GST) to its customers in the country. The new prices of Yamaha scooter and motorcycle range will vary from state to state.

"Yamaha welcomes the change through one nation, one market and one tax. It is quite likely that in the long run, the Goods and Service Tax (GST) will accelerate market demand as growth rate is expected to be around 10 percent after the implementation. On top of that, the market sentiment is optimistic, which may eventually lead to the assumed potential of the market which was debated during the implementation phase. Two-wheeler industry has come through several macroeconomic reforms this year like the engine standard upgrades and the transitory effect of demonetization which has affected the growth. What remains to be seen is how the implementation of GST will change the game," said Roy Kurian, Senior Vice President, Sales & Marketing, Yamaha Motor India Sales Pvt. Ltd.

Also read: GST effect on cars, bikes, scooters & SUVs: What will come cheaper and what will cost more?

GST impact, GST on scooters, GST on bikes, GST price cutIBTimes India/Raghavendra

Hero MotoCorp GST price cut

Hero MotoCorp, the country's largest two-wheeler maker has reduced prices of its models from Rs. 400 to Rs. 1,800.

"The quantum of reduction ranges from Rs. 400 to Rs. 1800 on mass-selling models. The actual benefit varies from state to state, depending on the pre and post-GST rates. Some of the premium segment models would see a reduction of up to Rs. 4000 in certain markets. In one or two states, such as Haryana, where the pre-GST rates were lower than the post-GST rate, the prices of a few models may go up marginally," Hero said in a statement.