(source : ANI) ( Photo Credit : ani)
India’s government just made a big move to rev up the car industry. On September 26, they announced cuts to Goods and Services Tax (GST) rates on various vehicles. This step aims to lower prices, especially for smaller and mid-sized cars, drawing in first-time buyers and making it easier for families to get on the road.
Let’s break down the new GST rates and what they mean for you.
Small Cars Get a Major Break
Small cars now face a GST rate of 18%, down from 28%. This change opens the door for more people to afford their first set of wheels and boosts everyday travel for households.
In smaller cities and towns, where these compact cars rule the roads, sales should pick up fast. Dealerships, repair shops, drivers, and even auto loan providers stand to gain from the surge in activity.
The tweak covers petrol, LPG, or CNG cars with engines under 1,200 cc and lengths up to 4 meters. It also includes diesel models under 1,500 cc and the same length limit. If you’re eyeing an entry-level ride, this could be your cue to shop.
Luxury and Larger Cars See Simplification
For bigger or luxury vehicles, the GST drops to a flat 40%—and there’s no extra cess on top. Ditching that cess not only cuts the total tax but makes pricing clearer and more reliable for buyers.
Even at 40%, the overall burden lightens up, helping those chasing premium models get closer to their dream car without the sticker shock.
How This Affects Car Insurance Premiums
Cheaper cars mean cheaper insurance, too. Premiums often tie to a vehicle’s Insured Declared Value (IDV), which drops when market prices fall. So, as cars become more affordable thanks to the GST cuts, your insurance costs could follow suit.
"This GST rate reduction creates a great chance for buyers to grab car insurance at lower rates," says Vinodh Sundareswaran, Head of Taxation at Royal Sundaram. "We urge people to seize this moment and lock in solid protection for their new rides."
Why This is the Perfect Time to Buy Insurance
Several perks make now ideal for securing coverage:
- Lower Costs: With vehicle prices down, IDV shrinks, trimming your premiums.
- Better Options: Affordable rates let you choose full packages, covering third-party damage, your own car’s repairs, and personal accidents.
- Sales Boom Benefits: Expect more cars on the road from the GST boost, which heats up the insurance market and keeps competition fierce for your business.
The GST slash doesn’t just save money— it puts more control in drivers’ hands. Fewer financial hurdles mean easier access to top-notch insurance. Royal Sundareswaran applauds the change and pledges to guide customers through these savings.
If you’re in the market for a car or need to update your policy, compare options carefully. Understand the details to protect your vehicle without breaking the bank. Head to the Royal Sundaram website for their car insurance lineup and start exploring.
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