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Join NowGST 2.0 on cars: In a move that has sent waves of excitement through the Indian automotive market, the newly implemented GST 2.0, which came into effect yesterday, September 22, 2025, has dramatically reshaped the pricing landscape for sedan cars. The Goods and Services Tax (GST) council’s decision to slash the tax rate has made the popular sub-compact sedan segment significantly more affordable, just in time for the lucrative festive season. This change is expected to trigger a massive surge in car sales across the nation.
Previously, these vehicles were subject to a hefty 28% tax. Under the new GST 2.0 rules, this has been drastically reduced to just 18%. For the average car buyer, this isn’t just a minor adjustment; it’s a game-changing price correction. Let’s dive into exactly which of your favorite sedans have become substantially cheaper.
Maruti Suzuki Dzire: The Undisputed King Gets More Affordable
The Maruti Suzuki Dzire has long been the champion of the sub-compact sedan segment, praised for its reliability, GNCAP safety ratings, practical nature, and premium features. With the new GST cuts, its appeal has skyrocketed. The price of the Dzire has been slashed by as much as ₹87,700.
This brings the new ex-showroom starting price down to an incredible ₹6.25 lakh. This massive price drop firmly re-establishes the Dzire as one of the best value-for-money options for Indian families, making a feature-packed and safe sedan more accessible than ever before.
Hyundai Aura: The Stylish Family Sedan’s New Appeal
The Hyundai Aura, known for its stylish design and family-friendly features, has also received a significant price reduction, making it an even more compelling budget-friendly option. The price for this popular sedan has been reduced by up to ₹76,316. Following the GST 2.0 implementation, the new ex-showroom price for the Hyundai Aura now starts from ₹7.74 lakh. This price adjustment is sure to attract a new wave of buyers looking for a blend of style, comfort, and now, exceptional value.
Honda Amaze: A Double Delight for Buyers
Honda has passed on the GST benefits to its highly respected sedan, the Amaze, with price cuts varying across its different generations. The second-generation Honda Amaze sees a substantial price reduction of up to ₹72,800.
For those eyeing the brand-new, third-generation Amaze, the news is even better. It receives an even bigger price cut of up to a staggering ₹95,500. This aggressive pricing strategy makes both the new and previous-generation models incredibly attractive options in the sedan market.
Understanding the New GST Rules on Cars
So, what exactly has changed? The new 18% GST rate applies to a specific category of vehicles:
- Petrol Cars: Length less than 4 meters and engine capacity less than 1200cc.
- Diesel Cars: Length less than 4 meters and engine capacity less than 1500cc.
This category includes most of the popular compact sedans and hatchbacks in India.
Furthermore, the luxury car segment has also seen a tax rationalization. Previously, luxury vehicles were taxed at 28% GST plus an additional 22% cess, totaling a punishing 50%. The new structure simplifies this to a flat 40% GST with no additional cess, providing a significant, if not as dramatic, price benefit to the premium and luxury car market as well. This festive season is, without a doubt, the best time in years to buy a new car.
