Buying a Car, This is how much tax do you pay. -
Buying a Car, This is how much tax do you pay.
Posted 05 Feb 2020 05:41 PM


Kia Seltos was recently launched in the Indian market after much anticipation. The market welcomed the Seltos and in the first month, Kia sold more than 6,000 units of the vehicle. The base variant of the Kia Seltos has been priced at Rs 9.69 lakh, ex-showroom, but one to pay the taxes and other registration charges to drive the vehicle legally on the road.

So how much tax do you really have to pay the government? Well, here an invoice from a customer of Kia Seltos, which shows the exact details.

The invoice shows the exact break-up of the price. This for the variant HTX, which is the second-top variant in the Tech Line models of the Seltos. The ex-showroom price of the car is Rs 13.79 lakh, however, the invoice shows that the NET value of the vehicle set by Kia Motors is Rs 9,51,034.
On Rs 9.51 lakh, net value, there are additional taxes in the form of CGST at Rs 14%, which adds another Rs 1,33,145 and the SGST at Rs 1,33,145. Moreover, there is a CESS at 17%, which adds another Rs 1,61,676 to the ex-showroom price. This is how the exact Rs 13.79 lakh, ex-showroom price breaks-down. A total of Rs 4,27,966 out of Rs 13,79,000 of the ex-showroom price is a tax set by the government.

Further, the car is then registered and there are a few other mandatory taxes and fees that the customer has to pay to make the vehicle road-legal and drive it on the public roads. There are other charges like the TCS charge of Rs 13,790, 14% Lifetime Tax of Rs 1,93,060, Hypothecation charges of Rs 1,500, Fastag of Rs 500, Insurance of Rs 52,929, Extended Warranty of Rs 23,877 and accessories worth Rs 8,439. Except for the last two charges, all other charges are mandatory. The on-road price of the vehicle with all the charges in place is Rs 16,74,730 while without the mandatory charges it boils down to Rs 16,42,414. From the NET price of Rs 9,51,034 to Rs 16,42,414 is a whopping Rs 6,91,380 in mandatory taxes, equipment, and insurance cover.


India is known for its high tax regime on cars, which is why there is a lower number of imported vehicles in the country. Fully imported models have to pay more than 200% of the tax of the value of the vehicle, which makes them extremely pricey and out of reach of many.

It should be noted that the government may cut down the taxes in the future due to the extreme slump in sales in the automotive market. The lower taxes are expected to attract more buyers as the overall price of the vehicle will go down.

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