GST on new tyres remains at 28 percent, bringing disappointment to companies seeking a cut on taxes to fight competition
The Goods and Services Tax (GST) Council on Saturday slashed the rate on retread tyres to 18 percent from 28 percent, being one of the several items that the government sought to make cheaper.
Retread tyres are refurbished tyres on which the worn out tread is replaced using new ones. It caters to the replacement segment. The market of retread tyres is not very big in India, but most tyre-making companies are involved in this business.
GST on new tyres remains at 28 percent, bringing disappointment to more than half a dozen listed and unlisted tyre companies who have been seeking a cut on taxes to fight competition from Chinese companies.
“The GST cut will benefit only the replacement market and not the new tyre market. There is not a huge market for retread tyres in India," said an official from a tyre company.
Indian tyre-making companies have been battling against tyres from China, many of which carry a cheaper price tag. Another demand of Indian companies was to increase customs duty on imported tyres.
