Major automakers including Tata, Mahindra, Renault, and Mercedes-Benz slash car prices by up to ₹1.56 lakh after GST Council’s tax reduction.
A Festive-Season Boost for Car Buyers
Indian car buyers are set to save big as leading automakers slash prices across their passenger vehicle lineups following a landmark Goods and Services Tax (GST) revision. Mahindra & Mahindra, Tata Motors, Renault India, and Mercedes-Benz have all announced reductions, passing on the full benefit of the GST Council’s latest rate cuts.
The decision comes just in time for the festive season, when car sales traditionally surge, giving the industry a timely boost.
Why Prices Are Falling
At its 56th meeting earlier this week, the GST Council unveiled sweeping tax cuts on vehicles and components. Small cars now attract an 18% GST rate down from 28% while larger cars and SUVs are placed under a flat 40% slab, scrapping the earlier combination of GST and cess. Electric vehicles remain at the favorable 5% GST rate.
This shift means that cars with bigger engines, once taxed at nearly 50% (28% GST plus 22% cess), will now face only 40%. Compact diesel cars under 1,500 cc and shorter than 4,000 mm are now taxed at 18%. Even motorcycles up to 350 cc move into the 18% bracket.
Mahindra: Price Cuts Up to ₹1.56 Lakh
Mahindra & Mahindra was the first to move, slashing prices from September 6. Popular SUVs and utility vehicles have seen sharp reductions, including:
Model
|
Maximum Price Benefit
|
Bolero/Neo
|
Up to ₹1.27 lakh
|
XUV3XO (Petrol)
|
Up to ₹1.40 lakh
|
XUV3XO (Diesel)
|
Up to ₹1.56 lakh
|
Thar 2WD (Diesel)
|
Up to ₹1.35 lakh
|
Thar 4WD (Diesel)
|
Up to ₹1.01 lakh
|
Scorpio Classic
|
Up to ₹1.01 lakh
|
Scorpio-N
|
Up to ₹1.45 lakh
|
Thar Roxx
|
Up to ₹1.33 lakh
|
XUV700
|
Up to ₹1.43 lakh
|
Tata Motors: Discounts Across the Portfolio
From September 22, Tata Motors will roll out reduced prices across its passenger vehicle lineup, cutting tags by as much as ₹1.55 lakh. The changes include:
Model
|
Maximum Price Benefit
|
Tiago
|
Up to ₹75,000
|
Tigor
|
Up to ₹80,000
|
Altroz
|
Up to ₹1.10 lakh
|
Punch
|
Up to ₹85,000
|
Nexon
|
Up to ₹1.55 lakh
|
Curvv
|
Up to ₹65,000
|
Harrier
|
Up to ₹1.40 lakh
|
Safari
|
Up to ₹1.45 lakh
|
Renault: Lower Prices Across Kwid, Kiger, Triber
Renault India has joined the price-cutting spree, with new tags effective September 22. Buyers can expect savings up to ₹96,395, depending on the model:
Model
|
Old Price
|
New Price
|
Price Reduction
|
Kiger
|
₹11.29 lakh
|
₹10.33 lakh
|
Up to ₹96,000
|
Kwid
|
—
|
—
|
₹49,000 – ₹57,000 (depending on variant)
|
Triber
|
—
|
—
|
₹76,000 – ₹80,000 (across trims)
|
Mercedes-Benz: Premium Segment Adjustments
Vehicle Type
|
Previous GST & Cess
|
New GST Rate
|
Effective Date
|
All ICE Models
|
~50% (28% GST + 22% cess)
|
40%
|
Sept 22, 2025
|
Electric Vehicles (EVs)
|
5%
|
5%
|
Sept 22, 2025
|
The Biggest Winners
Category
|
Model
|
Price Reduction
|
Top Discount
|
Mahindra XUV3XO (Diesel)
|
Up to ₹1.56 lakh
|
Close Contender
|
Tata Nexon
|
Up to ₹1.55 lakh
|
Smallest Cuts
|
Tata Curvv / Renault Kwid
|
₹65,000 / ₹49,000–₹57,000
|
What This Means for Buyers
Industry analysts believe the timing of these cuts couldn’t be better. With the festive season around the corner, price reductions are expected to reignite consumer demand, particularly in the SUV and compact car segments where competition is fierce.
“Passing on the GST benefits directly to customers strengthens affordability and boosts market confidence,” an auto expert explained, noting that competitive pricing may also pressure other automakers to follow suit.
Comparative–Maximum Benefits Across Automakers
Mega Comparison: Top Benefits & Effective Dates by Brand
Brand
|
Model with Highest Benefit
|
Maximum Benefit
|
Effective Date
|
Notes
|
Mahindra
|
XUV3XO (Diesel)
|
Up to ₹1.56 lakh
|
Sept 6, 2025
|
GST benefit passed on from revised slabs
|
Tata Motors
|
Nexon
|
Up to ₹1.55 lakh
|
Sept 22, 2025
|
Lineup-wide reductions effective same date
|
Renault
|
Kiger Emotion CVT
|
Up to ₹96,395
|
Sept 22, 2025
|
Kwid & Triber also see sizeable cuts
|
Mercedes-Benz
|
All ICE Models
|
Flat 40% GST (from ~50%)
|
Sept 22, 2025
|
EVs remain at 5% GST
|
Looking Ahead
As the auto sector embraces this new tax regime, consumers are the clear winners. With prices dropping across budget, mid-range, and luxury segments, the Indian car market is gearing up for a robust demand cycle in the months ahead.
(Disclaimer: This article is for informational purposes only. Prices, discounts, and GST slabs are as announced by the respective companies and may vary by location, dealership, or model availability.)
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