GST Impact - Royal Enfield Slashes Price

Goods and Services Tax (GST) will come into effect from July 1, 2017. However, there is still uncertainty among two-wheeler buyers on whether the new tax structure will reduce or hike prices. According to the new GST tax structure, motorcycles above 350cc will be levied a tax of 31 per cent, while two-wheelers under a displacement of 350cc will attract 28 per cent tax. 

Royal Enfield has announced that it will pass on the GST benefits to its customers, making it the second bikemaker after Bajaj Auto to do the same. While Bajaj has quantified that price reduction for its range of motorcycles will be up to Rs 4,500, Royal Enfield hasn’t done the same. Given the current tax structures, Royal Enfield bikes incur a tax of 30 per cent but since its bikes, like the Royal Enfield Classic 350, Thunderbird 350 and the Bullet 350 have displacements of 346cc, prices for them are likely to drop by two per cent. This also means that prices for the Royal Enfield Continental GT, Himalayan, Thunderbird 500, Classic 500 and the Bullet 500 will be increased because of the revision in tax. 

The revised pricing will be applicable post June 17th and when we contacted Royal Enfield officials, we were told that the new price list will be out by this week itself. Watch this space for more updates.