India’s tyre retreading industry has petitioned the government to slash goods and services tax (GST) rates from 18 percent to 5 percent on retreading services and materials, arguing the move would support environmental goals and the circular economy.
The Tyre Retreading Education Association (TREA), representing over 15 Indian retreading material manufacturers and retreaders serving approximately 10,000 retreaders nationwide, has written to authorities requesting the tax reduction across multiple product categories, including retreading services, retreaded tyres and retreading materials.
The industry body estimates India’s tyre retreading sector generates annual revenues of around INR 50 billion, with tread rubber manufacturing adding another INR 30 billion yearly. Last year, whilst 20,000,000 new truck tyres were sold domestically, approximately 80,00,000 truck tyres were retreaded, alongside smaller volumes of tractor, earthmover and car tyres.
“We are committed to educating and promoting retreading benefits: cost savings, safety, sustainability, and circular economy,” stated Karun Sanghi, Chairman of TREA, in the petition.
The request comes after recent GST amendments that reduced rates for new truck tyres from 28 percent to 18 percent, and cut levies on tractors, tractor tyres and tractor parts from 18 percent to 5 percent. However, conventional tread rubber used primarily for tractor tyres and retreading services for tractor tyres remain at the higher 18 per cent rate.
“We would request you to reduce the rate to five percent in line with other tractor products,” the association said, highlighting the inconsistency in tax treatment.
The industry argues that retreading aligns with government environmental priorities, pointing to the 2022 Extended Producer Responsibility (EPR) policy for tyres introduced to reduce environmental impact. The Environment Ministry has recognised retreading as “a very important part of the circular economy on tyres” and continues developing disposal systems for end-of-life tyres.
The association drew parallels with other environmentally friendly sectors that enjoy preferential GST rates, noting that electric vehicles are taxed at five percent, whilst rates for various renewable energy devices and solar water heaters were also reduced to five percent.
“The government recognised the need to support environmentally friendly industries,” the petition stated, emphasising that retreading represents “a critical part of the circular economy of tyres” supported by both the Environment Ministry and Central Pollution Control Board.
The group argued that increased tyre retreading would help India achieve its zero carbon footprint targets by extending tyre lifecycles and reducing waste requiring disposal.
India’s tyre retreading industry serves as a cost-effective alternative to new tyres whilst supporting sustainability objectives through reduced raw material consumption and waste generation.
The association has offered to provide additional information and meet with government officials to discuss the proposal further.
Comments (0)
ADD COMMENT