The government's indecisive approach to the implementation of 16 per cent General Sales Tax on tractor not only has ruined the tractor industry but also will have fatal repercussions on the Agri economy and engineering industry. Chairman of Auto Parts Manufacturers & Exporters Association (APMEA) Tahir Javed Malik, in a statement on Thursday said that delay in a clear-cut decision on the issue had caused the closure of 400 manufacturing companies of tractor parts.
He said that approximately 80,000 tractors were produced in the country last year and presently the tractor sale had nose-dived to 500 tractors a month. He said that the government on the pretext of bringing agri income under tax net and increasing the Tax to GDP ratio was trying to impose 16 percent GST on tractors. He said that GST on tractors in India is 4-5 percent, in Europe 8 percent while in other countries it is subsidised.