The much-anticipated GST 2.0 reforms have officially reshaped India’s automobile and agriculture markets. Implemented on 22 September 2025, these reforms simplify the GST structure into three broad slabs 5%, 18%, and 40% removing multiple rates and reducing complexities for consumers and manufacturers.
In line with this, Jeep India has announced significant price cuts across its model range. Customers can now enjoy ex-showroom savings between ₹1.26 lakh and ₹4.8 lakh, depending on the variant. This move makes Jeep vehicles more affordable at a time when demand for SUVs remains strong.
GST 2.0: Key Highlights
The GST Council’s decision is part of a larger effort to spur demand and make essential products cheaper while discouraging luxury consumption. Here are the main highlights:
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Small Cars:
Vehicles up to 4 metres, petrol engines ≤1,200cc, or diesel engines ≤1,500cc now attract 18% GST, down from 28% plus cess. -
Two-Wheelers:
Motorcycles and scooters with engine capacity ≤350cc now face 18% GST. Bikes above 350cc, including premium brands, are taxed at 40% GST. -
Large Cars and SUVs:
Vehicles longer than 4 metres and with engine sizes above the small-car limit are now taxed at 40% GST. -
Auto Parts:
All auto parts now have a uniform 18% GST, eliminating confusion from earlier HS code-based slabs. -
Agriculture Sector:
Farm equipment like tractors, harvesters, threshers, sowing machinery, and composting machines now fall under the 5% GST bracket, reduced from 12%.
This reform is expected to boost demand for budget-friendly vehicles, reduce farming costs, and streamline taxation for the auto industry.
GST 2.0: Sector-Wise Benefits
| Sector | Old GST Rate | New GST Rate | Impact |
|---|---|---|---|
| Small cars (≤4m, petrol ≤1,200cc, diesel ≤1,500cc) | 28% + cess | 18% | Prices reduced by up to 10% |
| Motorcycles ≤350cc | 28% | 18% | More affordable commuter bikes |
| Motorcycles >350cc, SUVs, luxury cars | Varies | 40% | Higher cost for premium buyers |
| Auto parts | 28%+ | 18% | Simplified taxation |
| Agricultural machinery | 12% | 5% | Cheaper farm equipment |
Jeep India’s Price Cuts Under GST 2.0
Jeep India announced that it will pass on the full GST benefit to its customers. The updated prices are effective from 22 September 2025.
| Jeep Model | New GST Rate | Maximum Savings (Ex-Showroom) |
|---|---|---|
| Compass | 40% | Up to ₹2.16 lakh |
| Meridian | 40% | Up to ₹2.47 lakh |
| Wrangler | 40% | Up to ₹4.84 lakh |
| Grand Cherokee | 40% | Up to ₹4.50 lakh |
According to Jeep’s business leadership, this initiative reflects the brand’s commitment to maintaining transparency and ensuring that customers benefit directly from government reforms.
Broader Impact on the Auto Industry
Jeep is not the only automaker extending GST 2.0 benefits. Several major companies have announced reductions:
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Hyundai Motor India: Price cuts of up to ₹2.4 lakh across models like the i20, Creta, and Tucson.
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Tata Motors: Discounts up to ₹1.45 lakh across its passenger vehicle portfolio.
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Kia India: Savings of up to ₹4.48 lakh, depending on the model.
The cumulative effect of these changes is expected to stimulate demand in India’s automobile market, particularly for compact cars and motorcycles, while luxury vehicles may see moderated demand due to higher taxation.
FAQs
1. What is GST 2.0?
A. GST 2.0 is the revised tax structure implemented on 22 September 2025, featuring simplified slabs of 5%, 18%, and 40%.
2. How much cheaper are Jeep models now?
A. Depending on the model, Jeep customers can save between ₹1.26 lakh and ₹4.84 lakh on ex-showroom prices.
3. Will budget cars like Maruti Alto or Tata Tiago benefit?
A. Yes. Small cars now attract 18% GST, making them around 8-10% cheaper.
4. What about luxury cars and big motorcycles?
A. They now fall under the 40% GST bracket, which makes them costlier than before.
5. How does this reform help farmers?
A. GST on agricultural machinery has been slashed to 5%, lowering farming equipment costs significantly.
6. Are auto parts now cheaper?
A. Yes, as all auto parts now fall under a single 18% GST slab, compared to earlier higher rates.
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