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GST rate cut on tyres to help bring down vehicle operating and logistics costs: ATMA
Sep-05-2025

Automotive Tyre Manufacturers' Association (ATMA) has said that the cut in Goods and Services Tax (GST) rates on tyres will help bring down vehicle operating costs, which in turn reduces overall logistics expenses in the economy. Welcoming the GST Council's decision to reduce the rate on tyres to 18 per cent from 28 per cent, it also said the step will make tyres more affordable for users across all segments and contribute positively to road safety by encouraging timely tyre replacement and maintenance.

ATMA said the long-awaited move will make tyres more affordable for users across all segments and contribute positively to road safety by encouraging timely tyre replacement and maintenance. It noted that tyres are a critical component of mobility and are used across the entire spectrum of vehicles - trucks and buses, passenger cars, two- and three-wheelers, tractors, construction equipment, and mining vehicles.

The tyre industry body stated that the earlier GST rate of 28 per cent placed tyres in the highest tax slab, at par with luxury or demerit goods, even though tyres are an essential requirement for transportation, agriculture, and logistics. The reduction will provide much-needed relief to consumers and industry alike. Moreover, the reduction in GST rates on tyres will support road safety as high prices often discourage vehicle owners from timely tyre replacement, leading to extended use of worn-out tyres, which is a known risk factor for accidents. With the tax burden eased, tyre affordability will improve, encouraging motorists and fleet operators to replace tyres at the right time, thereby enhancing vehicle and passenger safety on roads. 


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