End of Premium bikes in India? 40% Taxation Impact on 400cc+ Motorcycles. The Indian two-wheelers are very innovative by the package they provide with their respective prices. If we look at the international market, no manufacturer provides 400cc bikes at cost as low as Indian market. But where did the government miss? The newer taxation rules implements 40% tax on bikes of 400cc and larger. Now this affects the Indian manufacturer in many ways and the audience that is keen to buy premium bikes. We’ve already seen that Indian bikes are slowly making their space and image on global level. Taxation implementing from 22nd September. Click on official notice to see details.

What does it exactly affect?
(End of Premium bikes in India? 40% Taxation Impact on 400cc+ Motorcycles)

The problem with this newer taxation primarily affects the manufacturers as now making a premium bike will be more costly for them, and even though if they manage to make their premium products, the consumer will now have to pay a premium price as well which might affect the sales of the 400cc and above segment of bikes. Now this causes a huge loss to our manufacturers if they want to sell a premium segment bike and expand their boundaries to global extents.

To sum it up, if making a good and demanding product is getting costlier to them, the companies will face problems to develop manufacturing facilities across the globe. Extending this problem to a greater level is the exporting factor. Making manufacturing facilities can still be faced but is not a convenient option as without any response from international market, companies will definitely lack confidence to sell their products. A product that is already costly, will get even expensive if exported to other countries. If this was not the case India could’ve been an exporter of premium products at an affordable rate.

What does the consumer sacrifice?
(End of Premium bikes in India? 40% Taxation Impact on 400cc+ Motorcycles)

If we analyze the Indian market, we would come to know that people prefer to buy the products that provide them value. Addressing a factor that is mostly missed by every other person is India’s standard of living as compared to other countries. A majority of Indian consumer are limited to boundaries when buying a bike. As people are forced to buy products that are affordable, they miss out on the chance to buy a premium segment bike that is itself affordable before taxes. The taxation at some point feels way more than it should be.

How does India perform in international market?
(End of Premium bikes in India? 40% Taxation Impact on 400cc+ Motorcycles)

If we take an example of Mahindra to understand the taxation implemented on Indian automobile products, we would get to know the price difference between the Indian and Australian models of their cars. As cars that Mahindra sells in India are about an average 2-3 lakhs expensive as compared to Australia.

Price comparison (approximate)

Model	Australia price (AUD, listed)	Australia ≈ INR (AUD→INR @ ₹58.1)	India price (₹, listed ex-showroom)	Australia vs India (INR) — difference range	Approx % difference (AUS avg vs IND avg)
Mahindra XUV700	AUD 36,990 – 43,990. mahindra.com.au	₹2,149,119 – ₹2,555,819	₹1,449,000 – ₹2,514,000 (₹14.49L – ₹25.14L). CarDekho	AUT min vs IND range: +₹700k to –₹365k; AUT max vs IND range: +₹1,107k to +₹41k (depends on variant).	~+18.7% (Australia avg ≈ ₹2.35M vs India avg ≈ ₹1.98M)
Mahindra Scorpio-N	AUD 41,990 – 46,990. CarsGuide	₹2,439,619 – ₹2,730,119	₹1,399,000 – ₹2,515,000 (₹13.99L – ₹25.15L). CarWale	AUT min vs IND range: +₹1,040k to –₹76k; AUT max vs IND range: +₹1,331k to +₹215k.	~+32.1% (Australia avg ≈ ₹2.58M vs India avg ≈ ₹1.96M)
Mahindra Pik-Up (S11 / Dual-cab)	AUD ≈37,990 – 38,500 (common drive-away listings). CarsGuide	₹2,183,979 – ₹2,236,850	India (Bolero / Bolero Pik-Up family) ₹956,000 – ₹1,059,000 (≈₹9.56L – ₹10.59L). CarDekho	Australia price is ~+₹1.13M to +₹1.28M higher than Indian listed pickups (big gap).	~+119% (Australia avg ≈ ₹2.21M vs India avg ≈ ₹1.01M)

Conclusion
(End of Premium bikes in India? 40% Taxation Impact on 400cc+ Motorcycles)

If we summarize everything, taxation in India is allowing the audiences to go only towards the mid-category products and limits the interests and products for audience, whereas every other product with a slightly high standard gets slammed with Tax. Surely this is an issue that we and the government must address but we would change nothing about it, if we don’t know about it.

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