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Tractor Makers Demand To Cut GST Rates
Tractor makers have urged the government to cut GST rates to 18 percent on the components of tractor.
The Indian government is all set to implement the new Goods and Service Tax (GST) from July 1, 2017. But the tractor makers are not happy with the GST rates.
Under the GST tax slab, the majority of tractor components are levied with a tax of 28 percent. On the other hand, the construction equipment is levied only 18 percent tax.
The tractor makers have urged the government to reduce the tax to 18 percent on the tractor components. The construction and farming sector have identical emission norms, but they are being treated differently under the GST tax slab.
In a statement, Tractor Manufacturers Association (TMA) said, "The present levy is of 28 per cent GST on parts and components of tractors but parts and components of construction equipment, which are close kin to tractors especially under 80 HP, will attract only 18 per cent GST.”
The statement further read, "Parts of tractors, equipment and implements can be easily identified and used only in tractors and are not usable in automobiles which are high-speed applications as opposed to tractors which are low-speed, high-torque applications.”
Tractor manufacturers are also worried about the tax transition. With the stocks held at depots and dealerships, there are only a few days to the GST to come into effect. The tractor prices could increase from Rs 30,000 to Rs 34,000.
DriveSpark Thinks!
The new GST tax slab is a bit confusing when its comes to the agricultural sector. The luxury cars are levied way less tax than the farming equipment, which does not make sense. The government should soon rectify this loop holes in the GST taxation policy.
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