New GST on Bikes and Two-Wheelers in India: Rates, HSN Codes & Buyer Insights
Buying a bike or scooter is one of the most popular transport choices for Indian consumers, thanks to its affordability and convenience. But before you hit the road, it’s important to understand the taxes involved—especially the Goods and Services Tax (GST) . This blog breaks down the GST rates on two-wheelers in India, including electric bikes, HSN codes , and how GST affects your total cost.
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New GST Rate on Bikes in India
The Government of India is updating GST rates effective after 22 Sep 2025. Below are the expected new GST rates for Bikes (no compensation cess).
| Vehicle Type | Engine Capacity | GST Rate |
|---|---|---|
| Petrol/Diesel Bikes | > 350cc | 40% |
| Petrol/Diesel Bikes | ≤ 350cc | 18% |
| Electric Bikes/Scooters | All battery capacities | 5% |
Old GST Rate on Bikes in India?
(Old GST Rates – Applicable Until 21st September)
All petrol or diesel-powered two-wheelers—whether a scooter, bike, or motorcycle—are taxed at a standard GST rate of 28%.
However, electric bikes and scooters enjoy a lower rate of just 5%, thanks to government efforts to promote green mobility.
| Product Description | HSN Code | GST Rate |
|---|---|---|
| Petrol/Diesel Two-Wheelers | 8711 | 28% |
| Electric Two-Wheelers | 8711 | 5% |
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HSN Code for Two-Wheelers
Bikes and scooters fall under HSN Code 8711 , which covers all motorcycles (with or without side-cars), mopeds, and electric two-wheelers.
| Product Description | HSN Code | GST Rate |
|---|---|---|
| Petrol/Diesel Two-Wheelers | 8711 | 28% |
| Electric Two-Wheelers | 8711 | 5% |
Retailers and manufacturers must use this code on invoices for accurate GST filings .
GST Impact on Two-Wheeler Prices
Let’s look at an example:
Buying a 125cc petrol scooter worth ₹90,000
- GST @28% = ₹25,200
- Total Invoice = ₹90,000 + ₹25,200 = ₹1,15,200
Buying an electric scooter worth ₹1,00,000
- GST @5% = ₹5,000
- Total Invoice = ₹1,00,000 + ₹5,000 = ₹1,05,000
That’s a tax savings of ₹20,000+ when you choose electric!
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Why the Difference in Tax Rates?
- Petrol and diesel bikes fall under the luxury category, hence taxed at 28%.
- Electric bikes are part of the green initiative and are incentivized through a reduced GST rate of 5%, along with subsidies under the FAME-II scheme (Faster Adoption and Manufacturing of Hybrid and Electric Vehicles).
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Input Tax Credit (ITC) Rules for Two-Wheelers
In most cases, ITC is not allowed for two-wheeler purchases—even if the buyer is a GST-registered business.
Exceptions where ITC is allowed:
- When the vehicle is used for resale (e.g., bike showrooms)
- When used for transporting goods or passengers (e.g., delivery fleets, rental services)
- For training purposes (e.g., driving schools)
GST on Bike Accessories
Accessories and spare parts are taxed separately and usually attract GST between 18% and 28%.
| Item | GST Rate |
|---|---|
| Helmets | 18% |
| Bike covers, seat covers | 18% |
| Tyres, tubes | 28% |
| Engine parts, mirrors | 28% |
Make sure to ask for a tax invoice when buying accessories to know the breakdown.
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Final Thoughts
Understanding the GST on bikes and scooters helps buyers make informed financial decisions. While petrol-powered two-wheelers attract 28% GST, switching to electric alternatives offers major tax and environmental benefits. Whether you’re buying for personal use or business, make sure to ask for proper invoices and check the tax components to know what you’re paying for.
