Union Budget 2026-27 announced no direct price cuts for two-wheelers; prices remain stable, shaped by earlier GST changes and long-term EV support.
The Union Budget 2026-27, presented by Finance Minister Nirmala Sitharaman on February 1, 2026, did not announce any direct price cuts for two-wheelers, but several broader fiscal changes and tax reforms are likely to influence the market in the medium term.
No Immediate Price Cuts for Two-Wheelers
Budget 2026-27 focused largely on fiscal priorities like infrastructure, employment, and manufacturing support rather than sector-specific tax relief for vehicles. Industry analysts indicate there were no specific announcements to reduce GST or other direct duties on traditional petrol/diesel two-wheelers during the Budget speech itself, meaning ex-showroom prices are expected to remain stable or rise due to external factors such as input costs and demand.
Under the GST 2.0 regime introduced in 2025, two-wheelers saw a tax restructuring: basic commuter bikes and scooters up to 350 cc attract 18 % GST, down from the earlier effective rate of around 28 %, which has already helped reduce prices for that segment. Larger motorcycles above 350 cc can attract up to 40% GST, increasing prices in the premium bike category. These changes, though implemented before the 2026 Budget, continue to shape pricing.
Policy Trends and Future Possibilities
While Budget 2026 did not include new tax cuts for two-wheelers, it reinforced support for broader automotive and EV ecosystems, including incentives for green mobility and charging infrastructure. For electric two-wheelers, continued lower GST at 5 % and infrastructure support could gradually make EV models more competitive.
The industry bodies requested specific information and financial incentives, which they needed to assess the Budget proposal, especially regarding rural support and duty rationalisation.
GST changes, which started to take effect, make commuter scooters and bikes under 350 cc more affordable for consumers.
The higher GST rates will keep premium motorcycles at their current high price.
Electric two-wheelers will achieve better price performance through EV infrastructure development, but the Budget did not declare any specific price reductions.
The price of two-wheelers will not decrease immediately after Budget 2026, yet existing tax changes, together with upcoming infrastructure investments, will affect their cost over time.
