India’s two-wheeler market is gearing up for a big shake-up! With the government rolling out GST 2.0 reforms, commuter bikes and scooters are set to become more affordable than ever. From 22 September 2025, millions of buyers can look forward to savings just in time for the festive season.
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This major tax reform is rewriting the price tags of motorcycles across India. While everyday riders will enjoy sharp cuts on bikes under 350cc, premium motorcycle owners will now pay extra under the new “sin tax.” Here is everything you need to know about the new GST slabs and their impact.
2-Wheelers to Get Cheaper From Sept 22 After GST Cut
The Indian government rolls out a major GST 2.0 reform, bringing relief to millions of two-wheeler buyers. From 22 September 2025, two-wheelers with an engine capacity of up to 350 cc will taxed at 18% GST, down from 28%. This is a huge benefit for the commuter and mid-range bike market, which forms nearly 98% of sales in India.
On the other hand, motorcycles with engines above 350 cc will now face a 40% “sin tax”, up from an effective ~31%. This creates a clear distinction between mass-market and premium two-wheelers, impacting price tags across the country.
The timing of this reform is equally important. With the festive season starting late September, the reduced GST is expected to fuel record demand in the coming months.
Quick Summary of New GST 2.0 for Two-Wheelers
| Point | Key Update | Why It Matters |
|---|---|---|
| New GST Slabs | Bikes & scooters up to 350cc – 18% GST (down from 28%).Bikes above 350cc – 40% GST (earlier ~31%).EVs – 5% GST (no change). | Transparent, simplified structure. separating commuter vs premium bikes. |
| Effective Date | 22 September 2025, just before Navratri & Diwali. | Perfectly timed to boost festive buying. |
| Winners | Hero Splendor, Bajaj Platina, Honda Shine, TVS Jupiter, Royal Enfield Bullet 350. | 98% of the two-wheeler market gets cheaper by ₹7,000–₹20,000. |
| Losers | KTM 390, Apache RR 310, Triumph 400, RE 650 Twins, Harley X440. | Prices may rise ₹25,000–₹40,000, hitting enthusiasts. |
| Festive Impact | Buyers may wait until rate cut kicks in; weaker early Sept sales, but record Diwali demand expected. | Industry may see best festive season in a decade. |
| Why It Matters | Makes commuter bikes affordable.Revives demand post-COVID.EVs remain attractive.Premium bike sales may slow. | Directly impacts middle-class buyers, Tier-2 & Tier-3 towns, and boosts OEM volumes. |
Simplified GST Slabs: What Has Changed?
The GST Council has streamlined the structure to make it more transparent and predictable.
- 5% GST – continues for electric vehicles (EVs) and essentials.
- 18% GST – applicable to two-wheelers up to 350 cc (covering scooters and commuter motorcycles).
- 40% GST – levied on motorcycles above 350 cc, classified as premium or luxury products.
Effective Date – The new rates will come into force on 22 September 2025, just ahead of Navratri and Diwali.
Winners & Losers: Market Impact
Winners – Bikes up to 350 cc
- Hero Splendor, Bajaj Platina, Honda Shine, TVS Jupiter, and even the Royal Enfield Bullet 350 will now fall under the 18% slab.
- These price cuts directly benefit middle-class buyers and daily commuters.
- Almost 98% of the market enjoys the relief.
Losers – Bikes above 350 cc
- Premium bikes like KTM Duke 390, TVS Apache 310, Triumph 400, Royal Enfield 650 twins, and Harley-Davidson X440 now attract 40% GST.
- Prices of these models may increase by 7–10% depending on state road tax and insurance.
- Enthusiasts and premium buyers will feel the pinch.
Festive Season Impact
- Positive – The cut in GST will make most scooters and motorcycles cheaper, boosting sales volumes during Diwali.
- Negative (short term) – September’s first half may see weak sales as buyers postpone purchases until the lower GST is applied.
- Overall – Experts predict this could be the best festive season in a decade for two-wheeler OEMs.
Bike-Wise Price (Ex-Showroom)
| Model | Engine Capacity | Old Ex-Showroom (₹) | New Ex-Showroom (₹) | Price Difference |
|---|---|---|---|---|
| Hero Splendor Plus | 100 cc | ₹79,000 | ₹72,000 | ↓ ₹7,000 |
| Bajaj Platina 110 | 110 cc | ₹82,000 | ₹74,500 | ↓ ₹7,500 |
| Honda Shine 125 | 125 cc | ₹95,000 | ₹86,500 | ↓ ₹8,500 |
| TVS Jupiter 125 (Scooter) | 125 cc | ₹91,000 | ₹83,500 | ↓ ₹7,500 |
| Royal Enfield Bullet 350 | 350 cc | ₹1.80 lakh | ₹1.62 lakh | ↓ ₹18,000 |
| KTM 390 Duke | 373 cc | ₹3.20 lakh | ₹3.50 lakh | ↑ ₹30,000 |
| Royal Enfield Interceptor 650 | 648 cc | ₹3.50 lakh | ₹3.85 lakh | ↑ ₹35,000 |
| TVS Apache RR 310 | 310 cc | ₹2.70 lakh | ₹2.95 lakh | ↑ ₹25,000 |
Note – Prices are approximate and vary by state. Calculations are based on GST reduction/increase alone.
Why GST Change Matters?
- Affordability Boost – Entry-level riders in rural and urban areas get more purchasing power.
- Demand Revival – After years of muted sales post-COVID, this could revive India’s two-wheeler market.
- Premium Slowdown – Luxury and performance bike sales may soften, shifting focus back to commuter bikes.
- EV Advantage – With EVs still at 5% GST, the segment continues to remain attractive, supporting India’s push for green mobility.
Broader Industry Implications
- Manufacturers
- Brands like Hero MotoCorp, Honda, Bajaj, and TVS will see higher volumes in commuter bikes.
- Premium brands
- Royal Enfield (650cc), KTM, and Harley-Davidson could face slower sales.
- Consumers
- Middle-class buyers will benefit the most, especially in Tier-2 and Tier-3 towns where two-wheelers are essential.
- Government revenue
- Despite lower GST in mass market, higher sales volumes and luxury bike sin-tax could balance collections.
Planning Bike Purchase? Wait Till Sept 22 For Big Savings
The GST 2.0 reform is a strategic move benefiting everyday riders while ensuring luxury bike owners contribute more. From 22 September 2025, most two-wheelers will cheaper by ₹7,000 to ₹20,000, while premium motorcycles will get costlier by ₹25,000 to ₹40,000.
This policy is likely to accelerate demand, boost manufacturing, and give India’s auto sector a strong festive push. For buyers, the message is clear: if you’re planning to buy a commuter bike or scooter, this festive season might be the best time in years.
