2025 GST Update: How New Tax Slabs Affect Motorcycle Prices in India
GST Revision for Motorcycles in 2025 In 2025, the Goods and Services Tax (GST) on bikes in India underwent major revisions, aiming to make entry-level motorcycles more affordable. Meanwhile, taxes
GST Revision for Motorcycles in 2025
In 2025, the Goods and Services Tax (GST) on bikes in India underwent major revisions, aiming to make entry-level motorcycles more affordable. Meanwhile, taxes on premium and high-capacity bikes were increased, reflecting a shift in the government’s pricing strategy.
New GST Rates on Bikes in 2025
From September 22, 2025, the GST council implemented new tax slabs for motorcycles based on engine capacity:
- Bikes with engine capacity up to 350cc: GST rate reduced from 28% to 18%.
- Bikes with engine capacity above 350cc: GST rate increased substantially from 31% (28% GST + 3% cess) to 40%.
- Electric bikes remain taxed at 5%.
These changes aim to support commuter bikes and encourage fuel-efficient vehicles, while imposing higher taxes on luxury or high-performance motorcycles.
HSN Code for Bikes in India
The Harmonized System of Nomenclature (HSN) code for motorcycles and two-wheelers in India is 8711. This code covers petrol, diesel, and electric motorcycles, mopeds, and scooters with various engine capacities. Spare parts for bikes fall under HSN code 8714.
Impact of GST on Popular Bikes
Here are examples illustrating how the GST revision affected bike prices:
| Bike Model | Engine CC | Previous GST Rate | New GST Rate | Approx. GST Price Difference |
| Hero HF Deluxe | 100cc | 28% | 18% | ₹5,500 less |
| Honda Dio 125 | 125cc | 28% | 18% | ₹6,200 less |
| Yamaha R15 | 155cc | 28% | 18% | ₹17,500 less |
| Royal Enfield Classic 350 | 350cc | 28% | 18% | ₹16,500 less |
| KTM Duke 390 | 373cc | 31% (with cess) | 40% | ₹25,000 more |
| Royal Enfield Himalayan 450 | 411cc | 31% (with cess) | 40% | ₹22,000 more |
The revised rates have made commuter bikes like the Yamaha R15, Honda Dio, and Royal Enfield Classic 350 significantly more affordable. Meanwhile, premium bikes above 350cc like the KTM Duke 390 and Royal Enfield Himalayan have become costlier.
Comparison of Bike Prices With and Without New GST
- A Yamaha R15 priced earlier at ₹2,12,000 saw a reduction of around ₹17,500 due to the GST cut, bringing it down to about ₹1,94,500.
- The KTM Duke 390’s GST increase added approximately ₹25,000 to its price, pushing it upward of ₹3.5 lakh.
Thus, buyers of smaller bikes benefit from GST savings, while buyers of premium bikes face a steeper tax burden.
Summary
The 2025 GST revision benefits buyers of motorcycles up to 350cc with a reduced tax rate of 18%, encouraging the sale of fuel-efficient and commuter bikes. Premium motorcycles above 350cc are subjected to a higher GST rate of 40%, impacting luxury bike pricing. The HSN code for all these two-wheelers remains 8711, ensuring streamlined classification for tax purposes.
