GST Council clarifies what is an SUV in India
The GST Council has stated what it construes as an SUV in a new notification. This has been done to clear confusion over which vehicles should attract the higher tax rates for SUVs and set a countrywide definition for this bodystyle, since many states do not have a clear definition which has led to hurdles.
SUV definition as per GST Council, SUV tax rateThe GST Council has stated that a vehicle can be defined as an SUV if it is popularly known as an SUV, is longer than 4,000mm in length, has an engine capacity greater than 1,500cc and has 170mm or more of ground clearance.
The GST tax for these vehicles is 28 per cent, i.e the highest band. There is a further 22 per cent cess on SUV models, so if any cars son't fit this definition a lower cess will be applied on them. Combined, SUVs attract a high 50 per cent tax rate.
Effect on SUV pricesSince this statement only puts a fixed definition on SUVs, there shouldn't be any significant change in on-road prices of SUVs post this. Almost all sub-four-metre SUVs do not qualify as SUVs with this definition while most of the ones that are larger do. The only exception could be the Mahindra Thar and the Maruti Suzuki Brezza.