India’s new GST framework is reshaping vehicle affordability. With revised tax slabs now in effect, manufacturers like Mahindra have immediately passed on the benefits—slashing prices on popular models. Here’s a user-friendly overview to help you understand how GST reform is impacting auto prices and why it matters.
Key Highlights: What Changed with GST 2.0
- Simplified tax slabs were introduced:
- Small cars, bikes up to 350cc, and other entry-level vehicles now fall under 18% GST, down from 28%.
- Luxury cars and larger SUVs now attract a flat 40% GST, replacing the earlier combined 28% GST + 15–22% cess structure.
- This change boosts transparency and reduces the overall tax burden on big vehicles.
Mahindra’s Full GST Benefit Transmission
Starting September 6, 2025, Mahindra has reduced prices on its entire ICE SUV lineup to pass full GST benefits to customers:
| Model | Price Reduction (Up to) |
|---|---|
| XUV3XO (Diesel)uv | ₹1.56 lakh |
| XUV3XO (Petrol) | ₹1.40 lakh |
| Scorpio-N | ₹1.45 lakh |
| Thar 2WD (Diesel) | ₹1.35 lakh |
| Thar 4WD (Diesel) | ₹1.01 lakh |
| Scorpio Classic | ₹1.01 lakh |
| Bolero/Bolero Neo | ₹1.27 lakh |
These reductions are available both at dealerships and online platforms.
Also Read: Updated Honda Elevate 2025: Features, Deals, and Why It’s Worth Your Attention
Market-Wide Impact: Other Manufacturers Respond
- Tata Motors will implement price reductions—ranging up to ₹1.55 lakh—starting September 22, 2025, aligned with GST slab changes.
- Renault India has also announced cuts of nearly ₹96,395 on models like Kwid, Triber, and Kiger from the same date.
- Maruti Suzuki is expected to follow suit, with executive hints of similar reductions for popular models like Alto K10 and Wagon R.
Why It Matters: Broader Economic Implications
1. More Affordable Mobility
Reduced GST rates mean lower upfront costs. Cars like the Maruti Swift, Hyundai i20, and Tata Tiago could see price drops up to ₹1.4 lakh.
2. Stimulus for Vehicle Demand
Price cuts are expected to boost sales and stimulate the auto sector—especially ahead of the festival season—as consumer interest increases.
3. Positive Industry Ripple Effects
Lower prices improve affordability of auto components, servicing, and logistics—benefiting the MSME ecosystem and enhancing job growth and financing activity.
Comparison: Old vs New GST Structure
| Vehicle Type | Old Tax Rate | New GST Rate | Impact |
|---|---|---|---|
| Small cars (<1200cc) | 28% + cess | 18% | Price reduces significantly |
| Large SUVs & Luxury | 28% + 15–22% cess | 40% flat | Tax burden decreases overall |
| Two-wheelers <350cc | 28% | 18% | More affordable bikes |
| Auto Components | Variable | 18% wherever used | Lower production costs |
Also Read:TVS Ntorq 150 Launched at ₹1.19 Lakh: Price, Features, and Why It’s a Game-Changer
Conclusion
With GST 2.0, the Indian auto industry has become more consumer-friendly. Mahindra’s immediate price cuts reflect a customer-first approach, and other manufacturers quickly followed. Whether you’re eyeing an SUV or a compact car, now is a prime time to consider a purchase—or at least start exploring options.
FAQs: Mahindra XUV 3XO price cut
1. What is GST 2.0 in India?
GST 2.0 introduces new tax slabs for vehicles, reducing GST on small cars and two-wheelers to 18% and imposing a flat 40% rate on luxury cars and SUVs.
2. Which Mahindra cars got cheaper after the GST cut?
Models like the XUV3XO, Scorpio-N, Thar, Bolero, and Scorpio Classic have seen price cuts of up to ₹1.56 lakh.
3. When did the GST 2.0 price cuts take effect?
Mahindra implemented cuts on September 6, 2025, while Tata and Renault followed later in the month.
4. Will Maruti Suzuki and Hyundai also reduce prices?
Yes, both are expected to pass on GST benefits, with reductions on models like Alto, Wagon R, Swift, and i20.
5. How much can car buyers save under GST 2.0?
Depending on the model, buyers can save anywhere between ₹50,000 to ₹1.5 lakh.
Disclaimer: Information in this article is based on government announcements and trusted media sources, including Mint, Hindustan Times, Times of India, Business Standard, and NDTV. Vehicle price reductions may vary by variant and region; always confirm with your local dealership.
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Hi, I’m Simran Shah, a graphic designer and digital content creator with 4+ years of experience. I run two YouTube channels focused on AI, tech, mobiles, and automobiles — topics I’m truly passionate about.
My love for deep research started when I used to spend hours finding the best gadgets or information before making any decision. That’s when I realized I could help others save time by sharing my findings — both through well-researched content and visually compelling designs.
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