Atma urges GOVT not to treat on the same footing with luxury product, asks for 5 PC GST

Automotive Tyre Manufacturers Association (ATMA) On Monday, a reduction in the GST rates on tires for cars up to 5 percent compared to the current 28 percent, whereby the government was encouraged not to treat it on the same footing with luxury goods.

The body mentioned its impact on important sectors such as transport, agriculture, mining and construction.

Currently, all important categories of automotive tires are taxed at 28 percent, the highest tax plate, while tractor tires and aircraft tires are taxed at 18 percent and 5 percent respectively, ATMA said in a statement.

Tires is an important component in sectors such as transport, agriculture, mining and construction. A lower GST rate of 5 percent would provide relief to small traders, farmers and companies that depend on affordable transport.

The body of the tire makers further said that lowering GST on automotive tires would immediately lower the operating costs for vehicles and help reduce the logistics costs, benefit farmers, small traders, service providers and the infrastructure and mining sectors.

“Tires are indispensable for the movement of people and goods throughout India. Given their essential role in supporting national priorities, logistical efficiency and infrastructure, tires should not be treated on the same footing with luxury goods,” said ATMA chairman Arun Mammammen. Three-wheelers, tractors, construction and mining equipment, and therefore much lower loads deserve under the proposed GST rationalization exercise. ATMA said it has also marked the concern about possible accumulation of unused input tax credit (ITC) with policy traders once the changes to the tires dealers have been implemented.

The requirement of Atma occurs at the meeting of the GST Council, chaired by the Minister of Union Finance and consisting of ministers from all states and UTs, on 3 and 4 September, to discuss the reforms proposed by the center that most goods are charged with 5 percent or 18 percent.