Mercedes Benz cars now 4% cheaper as company passes GST benefit to customers
The effective price drop of the -made-in-India’ Mercedez Benz cars will be between Rs 1.4 lakh and Rs 7 lakh.autos Updated: May 25, 2017 18:33 IST
Luxury cars of Mercedes-Benz’s ‘made in India’ portfolio will now be roughly 4% cheaper, as the carmaker on Thursday announced passing the benefit of new goods and service tax applicable on luxury cars to the customer.
“The price revision on a weighted average of 4% will be effective immediately, and is aimed at providing value to a customer’s purchase decision before GST implementation,” the company said in a statement.
The effective price drop will be between Rs 1.4 lakh and Rs 7 lakh.
Under the new tax regime slated to be rolled out on July 1, luxury vehicles will attract a 28% GST, besides a maximum cess of 15%, so the maximum duty one would end up paying is 43%. The effective tax on the ex-showroom prices of luxury vehicles at present is around 52-55%.
“To ensure complete peace of mind for our customers, we have decided to pass on the GST tax benefits at an earlier stage at our cost. This approach will benefit the customers who want to purchase a locally-produced Mercedes-Benz from now on and during the month of June,” Roland Folger, Mercedes-Benz India MD and CEO, said in a statement.
However, the cost benefit, which ranges from 2% to 9% depending on the tax structure and local body taxes of the state, is only applicable on ‘made-in-India’ models such as the CLA, GLA, C-Class, E-Class, S-Class, GLC, GLE, GLS and Mercedes-Maybach S 500, which are priced between Rs 32 lakh and Rs 1.87 crore (ex-showroom Delhi).
The impact on the prices on vehicles imported as completely built units is yet to be evaluated, the Mercedes Benz India boss said.
The benefit would be applicable on all vehicles sold Friday onwards and through June, the company said. However, if the GST roll-out is delayed, the company would “revert to the old pricing till the time it is implemented”, Folger told PTI.
Hailing the new GST structure as “a landmark achievement for the Indian economy”, Folger said, “We are also confident that post GST implementation; there will be growth momentum in the luxury car industry.”
(With PTI inputs)