Rubber industry peeved at GST rates, Auto News, ET Auto

Kochi: The rubber products industry has expressed its displeasure at the discrimination in taxing two of their raw materials and the intermediary compounds.

\”While the natural rubber is kept at 5% GST, the synthetic rubber is in the 18% bracket. We need both as raw materials and hence both should be kept at 5%. Many of the rubber compounds are taxed at 18% instead of 12% as we recommended. Such a step will only serve to raise our cost of production further,’’ said Kamal Chaudhary, president of All India Rubber Industries Association.

Currently, 80% of the synthetic rubber needed by the industry are imported. The total tax of import duty plus GST will come to 23 %. At present with import duty, countervailing duty and other taxes it comes to around 20%, Chaudhary said.

The industry has been arguing for correction of the import duty structure of raw materials and finished products. While natural rubber import duty has been pegged at 25%, many finished products of rubber have nil to low import duty.

\”Keeping the GST of rubber intermediaries at 18% will affect the competitiveness of our products and will be a blow to Make in India initiative of the Prime Minister,’’ he said.

Meanwhile the tyre sector is assessing the impact of GST.