The decision to reduce GST rate on exclusive tractor parts to 18 per cent instead of an earlier proposed 28 per cent will provide a great relief to farming community, tractor manufacturers said on 1 July.
The GST Council 30 June cut tax rate on exclusive parts of tractors from 28 per cent to 18 per cent, while also announcing reduction on fertilisers to 5 per cent from previously decided 12 per cent.
Tractor Manufacturers Association (TMA) welcomed the move saying that this would go long way in making small and medium farmers profitable.
"The announcement of the GST council reducing GST on exclusive tractor parts has come as great relief to the farming community, which would otherwise have been impacted adversely," TMA said in a statement.
TMA immediate past president and chairman Technical Committee TR Kesavan said: "This reduction will go a long way in making small and medium farmers profitable, at a time when farm profitability has become critical."
Expressing similar views, TAFE Chairman Mallika Srinivasan said it will be a great relief to the hard pressed farming community and will ensure that there is no increase in costs for the farmers from the pre-GST days.
"The reduction of GST from the earlier announcement of 28 per cent on tractor parts and components to 18 per cent, which reflects the pre-GST revenue neutral duty," she added.