Tractor costs might go up by around Rs twenty five,000 when the products and services tax is obligatory as a result of the gap between input and output taxes is wide.
In a recent meeting, the GST Council self-addressed the difficulty of the inverted duty structure in numerous industries,together with the tractor trade. Subject to a twenty eight per cent duty on parts against twelve per cent on tractors,makers would have featured Associate in Nursing accumulation of credit. The council reduced the GST rate on clearly identifiable
tractor parts from twenty eight per cent to twelve per cent.
However, TR Kesavan, chairman of the technical committee and immediate past president of the Tractor Manufacturers’
Association (TMA), aforesaid the relief was marginal and input prices per tractor would rise
by Rs 25,000 The industry’s capital would even be squeezed by Rs one,600 crore, he added.
The revision of the GST rate was restricted to token parts whereas engines, transmission and different components would continue to face the twenty eight per cent duty, he said. The TMA has sought-after a modification in part duties from twenty eight per cent to eighteen per cent.
Mallika Srinivasan, president and chief military officer of Tractors and Farm instrumentality restricted (TAFE), said,“Unfortunately this (the GST) has solely been partly extended and therefore the increase in input value stands at Rs twenty five,000.”
She urged the govt. to scale back the duty on all parts that enter the manufacture of tractors.
“This would be required to make sure that the farming community doesn't suffer,” she additional.
Ravi Menon, chief military officer of Escorts, aforesaid tractor manufacturers may not be ready to die the upper prices to customers as a result of the anti-profiteering clause. Tractor manufacturers generally hike costs by Rs three,000-4,000 once a year.
Transitional provisions for stocks control at dealerships have conjointly not been extended to the tractor trade as a result of tractors were within the exempted class until currently. The trade holds over one hundred fifty,000 tractors in depots and dealerships, and denial of this
relief can have an effect on the farming community, in keeping with the TMA.
LIKELY to urge DEARER
28% duty on parts
12% duty on tractors
Industry says tractor costs would rise by Rs twenty five,000
The council reduced rate solely on clearly identifiable tractor parts from twenty eighth to twelve-tone system
The industry's capital would even be squeezed by Rs one,600 cr, trade body says
Tractor manufacturers generally hike costs by Rs three,000-4,000 once a year
Rise in worth to impact the farmers, says TMA
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