AC Prices, Decoded: What the GST Cut Gave and the Hikes Took Back

Air conditioners got a big tax cut in September 2025. A year later, most ACs cost about what they did before it. Here’s what happened in between, what an AC costs now, and how to time your purchase.

The GST cut, decoded

On 22 September 2025, GST on air conditioners fell from 28% to 18%. At the same pre-tax price, that takes 7.8% off the final price, so a ₹45,000 AC became about ₹41,500.

Brands passed it on at the time. Reported examples:

• LG cut entry models by ₹2,800–4,400.
• Godrej cut split inverters by ₹3,200–5,900.
• Haier cut a 1.6-ton inverter by ₹3,905.

What 2026 took back

Then the increases started. As reported through the year:

• Blue Star: 8–10% from mid-February.
• Daikin: up to 12% from April.
• Voltas: 5–15% across the year.
• LG: about 7% on 3-star models, 9–10% on 5-star.
• Another round from 1 October, reported at 5–8% on ACs.

The reasons makers gave:

• Copper. ACs are full of copper tubing, and Voltas put the metal’s rise at about $8,000 to $13,000 a tonne.
• A weaker rupee, which raises the price of imported compressors, inverter boards and electronics.
• The new BEE star labels from 1 January 2026, which need more efficient parts for the same stars. One maker summed up the new 5-star as about 10% more efficient and about 10% dearer.

Daikin’s MD had predicted prices would return to roughly where they were before the tax cut. Broadly, they did.

What ACs cost now

Indicative October 2026 listings for a 1.5-ton split AC, the size most Indian bedrooms need:

• Hisense 1.5T 3-star (2026): about ₹25,990
• LG 1.5T 3-star (2025 model, older label): about ₹29,690
• Daikin 1.5T 5-star (2026): about ₹49,590

Prices move daily in the festive sales, so treat these as a guide and check on the day.

Read the invoice

GST is already inside the MRP and the selling price. Your invoice should show 18% GST under HSN code 8415. If a dealer adds tax on top of a quoted price, ask why.

When to buy

1. Don’t wait for another tax cut. The GST Council’s 8 October 2026 meeting made no changes, and rates are now reviewed once a year.
2. Buy in the off-season. October to February brings festive offers and installers who aren’t booked out. In 2026 the increases landed just before and during summer.
3. Compare old-label and new-label models by ISEER, not stars. A 5-star on the old label is roughly a 4-star today, and fine to buy at a 4-star price. Our AC label guide explains how to read it.
4. Expect another efficiency step in 2028, when the star tables tighten again. That’s our expectation, not a forecast anyone has published.

Features: pay for these, skip those

• Pay for: an inverter compressor for daily use, a copper condenser where the air is salty or polluted, and the right tonnage for your room.
• Skip paying extra for: “AI cooling” (brand software with no standard), a PM 2.5 filter (not a real purifier), and hot & cold unless you live where winters are genuinely cold.

Honest verdict

The GST cut was real, but 2026’s price rises took most of it back, and another cut isn’t coming soon. Buy in the off-season, compare by ISEER, and pay for an inverter and copper, not for “AI”. For how the inverter itself works, see our inverter vs non-inverter guide.