Eicher Motors Exec Chairman Siddhartha Lal seeks Uniform 18% GST Across all Motorcycle CC Segments
Lal, who is credited with reviving Royal Enfield and positioning it as a global mid-size motorcycle leader, cautioned against this move in a social media post
The pioneer in reviving Royal Enfield in India, Siddhartha Lal has made a post on instagram asking the Government to unify Goods and Services Tax (GST) across all motorcycle CC-segments to 18%, warning that a differential tax structure could damage India’s rapidly expanding mid-capacity motorcycle market. At present, automobiles fall under the highest GST slab of 28 per cent,...
The pioneer in reviving Royal Enfield in India, Siddhartha Lal has made a post on instagram asking the Government to unify Goods and Services Tax (GST) across all motorcycle CC-segments to 18%, warning that a differential tax structure could damage India’s rapidly expanding mid-capacity motorcycle market.
At present, automobiles fall under the highest GST slab of 28 per cent, with an additional compensation cess of 1–22 per cent depending on engine size and type. Ahead of the upcoming GST Council meeting on September 3–4, reports suggest that policymakers may consider reducing tax on smaller two-wheelers to 18 per cent while keeping motorcycles above 350cc in the higher slab.
Lal argued that higher taxes on bigger bikes would not only yield negligible revenue but also stifle the growth of a segment that has put India on the global map.
“By delivering exceptional value, we are drawing riders worldwide to shift from larger, higher-displacement machines to Indian-made mid-size motorcycles. To sustain this momentum, a uniform GST of 18 per cent across all two-wheelers is critical,” Lal wrote.
Your Ultimate Guide to India’s Latest Income Tax Laws, Click Here
He emphasized that motorcycles above 350cc account for just about 1 per cent of India’s two-wheeler sales, making the potential tax gains minimal. Instead, imposing a heavier burden on this small but strategic segment could discourage buyers and limit the industry’s long-term prospects.
“For Indian riders, these motorcycles are not luxury goods; they are efficient, affordable alternatives to cars, offering lower fuel use and maintenance,” he noted. According to him, treating mid-size bikes as luxury products misrepresents their role in mobility and curtails consumer choice.
Lal further warned that excessive taxation could divert investment away from India’s motorcycle ecosystem at a time when global rivals are expanding aggressively. He argued that a stable and competitive tax regime was essential to safeguard India’s leadership in the mid-capacity segment and to encourage exports.
He also linked the issue to the future of sustainable mobility. “A uniform GST would help create the scale needed for electric two-wheeler adoption and strengthen allied sectors, from batteries to semiconductors,” Lal said.
Whether policymakers heed Lal’s call for a flat 18 per cent rate remains to be seen, but the debate highlights the balancing act between revenue concerns and long-term industry competitiveness.
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
