GST Effect: No Major Impact On Premium Bikes

Manufacturers of premium motorcycles have yet to announce the new Goods and Services, or GST prices of their products. Under the GST regime, bikes above 350 cc engine capacity will attract an additional cess of 3 per cent, over and above the flat 28 per cent GST. In all, the total tax incidence under GST will be roughly around 1 per cent more than the 30 per cent tax in the pre-GST era. It doesn't amount to much, especially on premium bikes from manufacturers such as Triumph, Ducati and Harley-Davidson.

"The impact of GST on premium bikes, that is, motorcycles over 350 cc, will be negligible. Even in the superbike space, a difference of just around 1 per cent will hardly matter to the customer who will be spending several lakhs on these bikes. Most manufacturers are still working out the prices, because the actual impact of GST isn't as simple, there are several things to be kept in mind, and how much these factors will finally affect the overall prices. But in all, there will be no impact really on the premium motorcycle space," said Abdul Majeed, Partner, Price Waterhouse.

Most premium bike makers maintain that announcing the new prices will take some time since the calculations of GST aren't really that simple. One source familiar with a superbike brand told CarandBike that calculating the new prices is complex, since imported bikes have to take into account several regulations and the impact of GST on each of these factors. Most manufacturers are still accepting bookings for premium bikes, but deliveries will only begin once new GST prices are announced.