Royal Enfield Pushes For Uniform 18% GST On All Motorcycles (Including 350cc+ bikes)

Siddhartha Lal, the Executive Chairman of Royal Enfield’s parent company, Eicher Motors, has urged the government to adopt a uniform 18 per cent Goods and Services Tax (GST) across all two-wheelers. The industrialist took to social media outlets such as X and Instagram to make his case - asserting that higher taxes on motorcycles above 350cc would hurt the industry without adding much revenue. The appeal comes ahead of the GST Council’s early September meeting, where tax changes for two-wheelers are likely to be discussed.

Why the Tax Debate Matters

Currently, motorcycles are taxed at 28 per cent GST, with an extra cess that takes the effective rate to about 31 per cent on larger bikes. The Council is considering cutting the rate to 18 per cent for smaller two-wheelers but raising it for those above 350cc.

Royal Enfield believes this would unfairly target mid-capacity motorcycles, which make up only about 1 per cent of the market. Mr. Siddhartha Lal has argued that these bikes are not luxury products but practical alternatives to cars. With lower fuel use and running costs, many riders see them as an efficient form of transport, not a status symbol.

Likely Price Impact on Riders

If the proposals go ahead, prices of popular Royal Enfield models below 350cc, such as the Bullet 350 (around Rs 1.8 lakh), Classic 350 (around Rs 2 lakh), and Meteor 350 (around Rs 2.1 lakh), could fall by roughly 8 to 10 per cent. That means a saving of Rs 15,000–20,000 for buyers.

But for bikes above 350cc, the impact would be the opposite. Models like the Himalayan 450 (around Rs 2.9 lakh), Interceptor 650 (around Rs 3.2 lakh), and Super Meteor 650 (around Rs 3.6 lakh) could become 8 to 10 per cent more expensive.

That translates to an increase of Rs 25,000–30,000 depending on the model. Larger upcoming models such as the Himalayan 750 or Continental GT-R 750 could face even sharper price hikes if a 40 per cent slab is introduced.

Such price shifts could discourage buyers at home and blunt India’s success in exporting mid-size motorcycles, where Royal Enfield has become a global leader.

Broader Industry Concerns

The argument goes beyond one brand. India’s motorcycle industry is a rare case of domestic players dominating globally. Heavy investments in technology and production have helped brands export mid-size motorcycles to markets once ruled by higher-displacement bikes.

Manufacturers say they need stability in tax policy to plan ahead. A patchwork approach with different slabs could hurt investor confidence, delay new model development, and limit production expansion. A uniform 18 per cent GST, they argue, would encourage investment while also making smaller motorcycles more affordable.

Balancing Policy and Competitiveness

Supporters of a single GST slab believe it will preserve India’s strength in the mid-capacity space while still supporting the mass commuter segment. Opponents of higher taxes on larger bikes point out that foreign competitors could gain ground if Indian products become more expensive.

The decision now lies with the GST Council. For buyers, it could mean noticeable changes in showroom prices in the months ahead. For manufacturers, it could determine whether India continues to lead in the mid-size segment or risks losing momentum.