Maruti Suzuki India Ltd. wants lower GST rates on small cars due to the impact US tariffs will have on other parts of the economy, according to its chairman.
“Lower GST rates are needed as US tariffs are causing disruptions in other Indian industries,” RC Bhargava said at the annual general meeting of India’s largest carmaker.
To be sure, the Narendra Modi government has already suggested lower GST rates on Maruti Suzuki’s breadwinner small cars, but US tariffs are set to weigh on buying power of people who opt for such vehicles.
The additional tariff, which came into effect on 27 August,. will take total duties to up to 50% for some goods, including garments, gems and jewellery, footwear, sporting goods, furniture, and chemicals, threatening thousands of small exporters and jobs—a key customer base for Maruti Suzuki.
GST Reforms
Prime Minister Narendra Modi, in his Independence speech on 15 August 2025, revealed plans for India’s biggest tax overhaul since 2017 with consumer, auto and insurance companies likely to emerge as the biggest winners when product prices drop from October.
The central government has suggested lowering the GST rate on small cars to 18% from the current 28%, Reuters reported on 18 August. The GST on health and life insurance premiums may also be lowered to 5% or even zero from 18% currently.
{{/usCountry}}The central government has suggested lowering the GST rate on small cars to 18% from the current 28%, Reuters reported on 18 August. The GST on health and life insurance premiums may also be lowered to 5% or even zero from 18% currently.
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