A recent government announcement has decreased the Goods and Services Tax (GST) on air conditioners, translating to approximately a 10% tax reduction on AC purchases. The GST on air conditioners and similar electronic devices has been reduced from 28% to 18%. These new rates are effective from September 22nd. If you plan on purchasing an AC, here’s how the change affects you, specifically focusing on the savings you can expect on a ₹35,000 AC.
**Expected Savings on AC Purchases**
Consumers are set to save significantly following the government’s GST reduction on ACs. A 1 or 1.5-ton AC in India generally starts at around ₹35,000. With the GST cut, prices are expected to decrease. Let’s examine the financial impact.
**Understanding the GST Change**
Previously, ACs were subject to a 28% GST, which raised their cost. This has now been lowered to 18%. This change will lower prices for consumers and likely increase competition in the market.
**Savings Calculation for a ₹35,000 AC**
For an air conditioner priced at ₹35,000, the GST reduction could result in savings of approximately ₹3,150. The original tax amount at 28% GST was about ₹6,800, which will now be around ₹3,150 with the 18% GST. This represents a direct savings of up to 10%.
Therefore, a ₹35,000 air conditioner might now be available for around ₹31,850, which means savings of over ₹3,150. Additionally, purchasing during the festive season might bring further benefits, such as card discounts and other promotions.