{"id":7922,"date":"2025-07-16T12:30:06","date_gmt":"2025-07-16T12:30:06","guid":{"rendered":"https:\/\/lemonn.co.in\/blog\/?post_type=glossary&#038;p=7922"},"modified":"2025-07-16T12:30:07","modified_gmt":"2025-07-16T12:30:07","slug":"gst-on-bikes-two-wheelers-in-india","status":"publish","type":"glossary","link":"https:\/\/lemonn.co.in\/blog\/glossary\/gst-on-bikes-two-wheelers-in-india\/","title":{"rendered":"GST on Bikes \/ Two-Wheelers in India"},"content":{"rendered":"<h2 id=\"gst-rates-for-new-bikes\" class=\"wp-block-heading\"><a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/gst-rates\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">GST Rates<\/a> for New Bikes<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Petrol\/diesel two&#x2011;wheelers &#x2264;&#x202F;350&#x202F;cc:<\/strong> 28% <a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/gst\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>GST<\/a> <\/li>\n\n\n\n<li><strong>Petrol\/diesel &gt;&#8239;350&#8239;cc:<\/strong> 28% + 3% cess = <strong>31%<\/strong> GST total<\/li>\n\n\n\n<li><strong>Electric two-wheelers:<\/strong> <strong>5%<\/strong> GST (reduced from 12% to promote green mobility)<\/li>\n<\/ul>\n\n\n\n<p>All new and used two-wheelers, including scooters and motorcycles, attract GST based on these categories.<\/p>\n\n\n\n<h2 id=\"gst-on-related-services-parts\" class=\"wp-block-heading\">GST on Related Services &amp; Parts<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Two&#x2011;wheeler insurance:<\/strong> 18% GST applies to premiums<\/li>\n\n\n\n<li><strong>Spare parts (e.g., brakes, brake pads, clutch cable):<\/strong> 28% GST<\/li>\n\n\n\n<li><strong>Battery charging, consumables, lubricants:<\/strong> 18% GST<\/li>\n<\/ul>\n\n\n\n<h2 id=\"gst-on-used-bikes\" class=\"wp-block-heading\">GST on Used Bikes<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Dealers (registered <a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/tax\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>tax<\/a>payers) selling used vehicles must pay <strong>18% GST<\/strong> on the margin (difference between selling and purchase price), effective from January 16, 2025.<\/li>\n\n\n\n<li>Sales between individuals (unregistered) are <strong>exempt<\/strong>.<\/li>\n<\/ul>\n\n\n\n<h2 id=\"why-these-rates\" class=\"wp-block-heading\">Why These Rates?<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Higher GST (28&#x2013;31%) on petrol\/diesel bikes is treated as &#x201C;luxury or sin&#x201D; category.<\/li>\n\n\n\n<li>Reduced 5% rate on electric bikes is a green incentive from the government.<\/li>\n<\/ul>\n\n\n\n<h2 id=\"input-tax-credit-itc\" class=\"wp-block-heading\">Input Tax Credit (ITC)<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Personal vehicles <strong>do not qualify<\/strong> for ITC.<\/li>\n\n\n\n<li>ITC is allowed if the vehicle is used:\n<ul class=\"wp-block-list\">\n<li>For resale (dealership business)<\/li>\n\n\n\n<li>In passenger transport (e.g., bike taxis)<\/li>\n\n\n\n<li>For rider training (driving schools) <\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<h2 id=\"example-cost-breakdown\" class=\"wp-block-heading\">Example: Cost Breakdown<\/h2>\n\n\n\n<ol class=\"wp-block-list\">\n<li><strong>New petrol scooter (125 cc):<\/strong><br>Ex-showroom &#x20B9;90,000 &#x2192; GST @28% = &#x20B9;25,200 &#x2192; Total &#x20B9;1,15,200<\/li>\n\n\n\n<li><strong>Electric scooter (e&#x2011;scooter worth &#x20B9;100,000):<\/strong><br>GST @5% = &#x20B9;5,000 &#x2192; Total &#x20B9;1,05,000<\/li>\n<\/ol>\n\n\n\n<h2 id=\"summary-table\" class=\"wp-block-heading\">Summary Table<\/h2>\n\n\n\n<figure class=\"wp-block-table\"><table><thead><tr><th><strong>Item<\/strong><\/th><th><strong>GST Rate<\/strong><\/th><\/tr><\/thead><tbody><tr><td>Petrol\/Diesel &#x2264;&#x202F;350&#x202F;cc<\/td><td>28%<\/td><\/tr><tr><td>Petrol\/Diesel &gt;&#8239;350&#8239;cc<\/td><td>31% (28% + 3% cess)<\/td><\/tr><tr><td>Electric two-wheelers<\/td><td>5%<\/td><\/tr><tr><td>Two-wheeler insurance<\/td><td>18%<\/td><\/tr><tr><td>Spare parts &amp; consumables<\/td><td>18&#x2013;28% depending on part<\/td><\/tr><tr><td>Used vehicles (dealers\/margin)<\/td><td>18%<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 id=\"impact-industry-response\" class=\"wp-block-heading\">Impact &amp; Industry Respo<a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/nse\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>nse<\/a><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>High GST on larger bikes has dampened demand; manufacturers like Hero, Bajaj, Honda are urging tax cuts.<\/li>\n\n\n\n<li>Lower GST on EVs boosts affordability and adoption of green transport.<\/li>\n<\/ul>\n\n\n\n<h2 id=\"key-takeaways\" class=\"wp-block-heading\">Key Takeaways<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Buying a bike?<\/strong> Know the GST bracket; electric is far cheaper tax-wise.<\/li>\n\n\n\n<li><strong>Buying used via dealer?<\/strong> Factor in 18% margin-based GST.<\/li>\n\n\n\n<li><strong>Business owners?<\/strong> You may claim ITC if the vehicle is used commercially.<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>GST Rates for New Bikes All new and used two-wheelers, including scooters and motorcycles, attract GST based on these categories. GST on Related Services &amp; Parts GST on Used Bikes Why These Rates? Input Tax Credit (ITC) Example: Cost Breakdown Summary Table Item GST Rate Petrol\/Diesel &le;&#8239;350&#8239;cc 28% Petrol\/Diesel &gt;&#8239;350&#8239;cc 31% (28% + 3% cess) [&hellip;]<\/p>\n","protected":false},"author":9,"featured_media":0,"menu_order":0,"template":"","meta":{"footnotes":""},"class_list":["post-7922","glossary","type-glossary","status-publish","hentry"],"blocksy_meta":[],"_links":{"self":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary\/7922","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary"}],"about":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/types\/glossary"}],"author":[{"embeddable":true,"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/users\/9"}],"version-history":[{"count":1,"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary\/7922\/revisions"}],"predecessor-version":[{"id":7923,"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary\/7922\/revisions\/7923"}],"wp:attachment":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/media?parent=7922"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}