Indian Tyre Industry Seeks GST Relief
The Automotive Tyre Manufacturers Association (ATMA) is urging the Indian government to reduce the Goods and Services Tax (GST) on tyres, which are currently taxed at the highest slab of 28%.
ATMA argues that tyres are not luxury goods but essential components for mobility across critical sectors like transportation, agriculture, and mining. Reducing the GST rate would directly lower vehicle operating costs, benefiting everyone from small traders and farmers to large enterprises.
The association has proposed a lower GST rate of 5%, aligning it with the rate for aircraft tyres and providing significant relief to the entire supply chain.
ATMA has also highlighted a key concern: a potential blockage of working capital for tyre dealers due to unutilized Input Tax Credit (ITC) if the rate is changed. To prevent this, the association is pushing for an early announcement of the new rates and a one-time refund of unutilized ITC.
This move is part of a broader effort to rationalize the GST structure and support key national priorities like logistics efficiency and infrastructure development.