A proposed reduction in Goods and Services Tax (GST) on two-wheelers could significantly enhance affordability for first-time buyers, particularly in rural and semi-urban areas, according to Pawan Munjal, Chairman of Hero MotoCorp. Speaking ahead of the GST Council meeting scheduled for September 3-4, 2025, Munjal emphasized the transformative potential of the reform for India’s two-wheeler industry, a critical driver of personal mobility and economic growth.

In a statement, Munjal welcomed the government’s consideration of GST reforms, which may lower rates on two-wheelers from the current 28 percent slab for vehicles up to 350 cc, and 28 percent plus a 3 percent compensation cess for those above 350 cc. “This progressive step will serve as a crucial enabler, offering much-needed relief to first-time buyers, particularly in rural and semi-urban areas, where two-wheelers remain the backbone of personal mobility,” he said. “It will significantly enhance accessibility and affordability for millions of Indians.”

Munjal highlighted the two-wheeler industry’s broader economic impact, noting its substantial contributions to government revenues and employment generation across its value chain. “The two-wheeler industry is not only a key driver of mobility but also a vital pillar of the national economy,” he added.

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The upcoming GST Council meeting, chaired by the Union Finance Minister and attended by state and Union Territory ministers, will discuss reforms proposing that most goods be taxed at either 5 percent or 18 percent. A reduction in GST rates could make two-wheelers more accessible, empowering millions of Indians with affordable transportation and bolstering economic activity in the sector.

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