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Old 4th July 2017, 18:02   #496
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Default Re: GST effect on car prices?

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Originally Posted by Vid6639 View Post
How can that be. GST has an anti profiteering clause so difference in price before and after GST should be exactly the difference between the tax % change.

Is there a loophole being exploited by the manufacturers?
BMW will claim it already decreased the price in May'17 in anticipation of GST. Does the GST law have a reference date post which the price needs to be dropped ?
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Old 4th July 2017, 18:07   #497
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Default Re: GST effect on car prices?

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Originally Posted by smsrini View Post
BMW will claim it already decreased the price in May'17 in anticipation of GST. Does the GST law have a reference date post which the price needs to be dropped ?
They never dropped prices in May. Rather heavy discounts were being offered on the list price which remained same. They have reduced the list price marginally now, but expect heavy discounting to continue on older models , while newer launches will see negligible to no discounts for some time atleast.
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Old 4th July 2017, 20:52   #498
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Default Re: GST effect on car prices?

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Originally Posted by rambo1o1 View Post

Please don't be offended but ,Could you clarify how good your source is😁
I hope these prices are true.
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Originally Posted by drive_angry View Post
Yes even I want to know the source. I just spoke with my Hyundai dealer and he is not ready to confirm the prices.
My bad. Source is a close friend working for a leading auto website. Amount should be very close to what he has quoted.
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Old 4th July 2017, 22:30   #499
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Default Re: GST effect on car prices?

My friend had booked Ciaz SVHS on 24th June, in anticipation of hike due to GST. He had paid the booking amount and applied for loan. Loan is under process and he paid the balance amount not covered by loan.

Now the price had gone up by 1 lakh and dealer is telling they have to pay new price, since they had not raised the invoice. This is lame excuse by the dealer because earlier they had said they had already raised the invoice.

After much negotiation, dealer says they can reduce the price by 50K. So my friend has to pay 50K more than booking amount. Upset, my friend is planning to cancelling the booking.

What rights does my friend have? Can dealer go back on the booking contact?

PS: Dealer is Kalyani, Mysore Road, Bangalore.
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Old 4th July 2017, 23:09   #500
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Default Re: GST effect on car prices?

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After much negotiation, dealer says they can reduce the price by 50K. So my friend has to pay 50K more than booking amount. Upset, my friend is planning to cancelling the booking.
Not much, but why will dealer keep stocks without invoicing? Double check he must have raised invoiced already. As per GST laws, any unsold stocks will qualify only for 60 % refund of Excise & I doubt Maruti is going to support any dealer on Hybrids. If he will raise an invoice in current date at the current structure for hybrids all Tax money is going to Government.
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Old 5th July 2017, 10:03   #501
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Default Re: GST effect on car prices?

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Originally Posted by msdivy View Post

What rights does my friend have? Can dealer go back on the booking contact?
Generally the price prevailing at the time of delivery is applicable, but if the dealer had promised price protection against expected price increase then morally he should have honored it, but he is not legally bound as such.

The best option would be cancel the booking and drop in a complaint at MSIL.
But if your friend is really keen on buying the same car then he can further try and negotiate.
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Old 5th July 2017, 10:50   #502
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Default Re: GST effect on car prices?

Mahindra has also announced post GST prices.

Quote:
The prices of vehicles for end customers on large UVs and SUVs have been reduced by an average of 6.9 per cent, while those that come under the small car segment have been reduced by an average of 1.4 per cent, Mahindra said in a regulatory filing.
I thought XUV, Scropio and Xylo will get 10-11% drop.

Quote:
Similarly, the company has reduced prices of small commercial vehicles by an average of 1.1 per cent and 0.5 per cent for light commercial vehicles and heavy commercial vehicles. The company has, however, increased the prices of hybrid vehicles marginally.
Which hybrid vehicles Mahindra sells?

Source:ET Auto:
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Old 5th July 2017, 11:25   #503
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Default Re: GST effect on car prices?

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Originally Posted by S.MJet View Post

I thought XUV, Scropio and Xylo will get 10-11% drop.


]:
There is a reduction in effective tax rate (say by 12%, from 55% pre-GST to 43% post GST), that doesn't mean the price of the vehicle will drop by that amount. For example (for approximate calculation):

Say, ex-showroom price of an SUV A was Rs 155 (Rs 100 base price + Rs 55 taxes)

Now, post GST, considering the manufacturer passes total tax reduction benefit to the customer, then the same SUV will cost Rs 143 (Rs 100 base price + Rs 43 GST+cess)

Now form pre-GST price of Rs 155 to post GST-price of 143 the price reduction in % term is: (155-143)/155=7.742% only

Similar maths can be applied for all categories.

Below is the benefit calculation over pre-GST ex-showroom prices:

1. Small Petrol car (<4 m): ~ 1.9%

2. Small diesel car (<4 m): ~ 1.7%

3. Small cars (< 4 m, but petrol >1200 CC, diesel> 1500 CC): ~ 1.2%

4. Big cars (> 4 m): ~ 5.7%

5. SUV: ~ 7.7%

6. Electric car: ~ 7.1%

7. Hybrid car: Price increase

Thanks
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Old 5th July 2017, 12:02   #504
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Default Re: GST effect on car prices?

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Originally Posted by kbishwa View Post
There is a reduction in effective tax rate (say by 12%, from 55% pre-GST to 43% post GST), that doesn't mean the price of the vehicle will drop by that amount. For example (for approximate calculation):
You are correct, was confusing tax reduction with price reduction. Thanks
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Old 5th July 2017, 12:20   #505
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Default Re: GST effect on car prices?

The GST has an anti profiteering clause - where in companies can be hauled up for not passing on the benefit of price reduction allowed by GST.

Then HOW is it this allowed !!! - Maharashtra Govt: Road tax on private vehicles hiked by 2% ???
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Old 5th July 2017, 12:34   #506
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Default Re: GST effect on car prices?

The anti profiteering clause was dropped, atleast from the enforcement perspective, even before the GST became operational.

The former FM came down heavily on this resurrected relic from the licence raj days, as something thought up by someone who has no clue how trade functions.

The benefits of this system will be from smoother tax collection, the prices will reflect the earlier inefficiencies for some time. How many of those calling out profiteering will allow the government to restrict how much you earn?
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Old 5th July 2017, 12:57   #507
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Default Re: GST effect on car prices?

@avira_tk

Not debating the smoothness or benefits.

Just pointing out the unfairness - we get a benefit from the central govt and the state govt immediately increases the road tax !!

And the state govt has a commitment from the centre - that the losses will be made up for the next 5 years.

And it is not as if the state govt is not getting a share from the present GST rate slabs !

The road tax hike is just SAD.
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Old 5th July 2017, 13:08   #508
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Default Re: GST effect on car prices?

Hyundai still have not updated the post GST prices. Aren't they missing a lot of sales ?
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Old 5th July 2017, 13:18   #509
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Default Re: GST effect on car prices?

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Originally Posted by sabby_4c View Post
Hyundai still have not updated the post GST prices. Aren't they missing a lot of sales ?
I just read up on the below link about the new Hyundai prices. Seems announcement has just been made. I am not able to access prices on Hyundai website. Creta gets a substantial price cut, which should increase the sales further.

https://gaadiwaadi.com/gst-hyundai-c...heaper-859866/
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Old 5th July 2017, 13:28   #510
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Default Re: GST effect on car prices?

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Originally Posted by avira_tk View Post
The anti profiteering clause was dropped, atleast from the enforcement perspective, even before the GST became operational.
May not be true. Govt already deployed 200 officers for district level monitoring

http://www.business-standard.com/art...0400736_1.html

http://www.livemint.com/Politics/zMG...ntation-o.html
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