Buyer Pays More Than 50% In Taxes On SUVs In India. Post Goes Viral In X, Ignites Debate

According to Behal’s post, the base price of the vehicle is Rs 14.58 lakh, but after factoring in 14% SGST, 14% CGST, and a 20% GST cess, the final cost of the SUV jumps to Rs 21.59 lakh

In India, buying an SUV comes with a hefty tax burden, with buyers paying over 50 per cent of the vehicle's price in taxes. A recent post on X (formerly Twitter) by user Sumit Behal highlighted this issue, sharing a bill for a Mahindra XUV 700 Diesel.

According to Behal’s post, the base price of the vehicle is Rs 14.58 lakh, but after factoring in 14 per cent SGST, 14 per cent CGST, and a 20 per cent GST cess, the final cost of the SUV jumps to Rs 21.59 lakh.

Behal expressed frustration in his post, saying, “You will be paying these taxes after paying taxes on your salary and capital gains. This is India’s growth story.”

Currently, the Goods and Services Tax (GST) on SUVs in India is set at 28 per cent, with an additional cess applied, unless the vehicle is electric. Electric vehicles are taxed at a much lower rate of 5 per cent, as part of the government's effort to promote cleaner transportation.

The steep tax rate on conventional SUVs has been a point of contention, as buyers feel the overall cost becomes prohibitive. Many are calling for reforms, especially in light of the push toward green energy alternatives.

Users who commented on Behal's post shared mixed reactions. One remarked, "India has first world taxation with third world lifestyle and facilities." Another pointed out, "Apparently, the government is earning more than the car manufacturer."

A different user added, "...and you think this started after 2014? You were paying the same before, and all we had was India's economic decline..."

Before GST was introduced in the country, multiple taxes such as Excise Duty, VAT, Infrastructure Cess, CENVAT, and Entry Tax had to be paid, along with road tax and 4-wheeler insurance.