CBIC Notifies GST Increase on Old Used Vehicles including EV: Rate Revised from 12% to 18% [Read Notification]

The Ministry of Finance has issued Notification No. 04/2025 - Central Tax (Rate), dated 16th January 2025, announcing an increase in the Goods and Services Tax ( GST ) rate applicable to used electric vehicles ( EVs ). This notification brings significant changes to the tax framework for old and used vehicles, including EVs. This notification comes into force immediately upon issuance.

Increase in GST Rate

The GST rate for S. No. 4, "All Old and Used Vehicles other than those mentioned from S. No. 1 to S. No. 3," has been increased from 6% to 9%. This change is effective immediately as per the notification.

The GST rate applicable to the sale of all old and used vehicles, including electric vehicles ( EVs ) not covered under specific exceptions has been revised from 12% to 18%.

Become a PF & ESIC expert with our comprehensive course - Enroll Now

UPDATED TABLE

S. No	Chapter, Heading, Subheading, or Tariff Item	Description of Goods	Rate
1	8703	Old and used, petrol Liquefied petroleum gases (LPG) or compressed natural gas (CNG) driven motor vehicles of engine capacity of 1200 cc or more and of length of 4000 mm or more. Explanation: For the purposes of this entry, the specification of the motor vehicle shall be determined as per the Motor Vehicles Act, 1988 (59 of 1988) and the rules made thereunder.	9%
2	8703	Old and used, diesel-driven motor vehicles of engine capacity of 1500 cc or more and of length of 4000 mm Explanation: For the purposes of this entry, the specification of the motor vehicle shall be determined as per the Motor Vehicles Act, 1988 (59 of 1988) and the rules made thereunder.	9%
3	8703	Old and used motor vehicles of engine capacity exceeding 1500 cc, popularly known as Sports Utility Vehicles (SUVs) including utility vehicles. Explanation: For the purposes of this entry, SUV includes a motor vehicle of length exceeding 4000 mm and having ground clearance of 170 mm. and above.	9%
4	87	All Old and used Vehicles other than those mentioned from S. No. 1 to S.No.3	9%

The principal notification No. 8/2018-Central Tax (Rate), dated 25th January 2018, was originally published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), under G.S.R. 82(E). This foundational notification has now been amended through Notification No. 04/2025 - Central Tax (Rate) dated 16th January 2025, reflecting changes to GST rates on old and used vehicles, including electric vehicles.

To Read the full text of the Notification CLICK HERE

Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates