New GST on Tractors in India: Exemptions and Rates
Tractors are the backbone of Indian agriculture. Whether you’re a farmer or in the agricultural equipment business, understanding GST on tractor purchases and related items helps in making better financial decisions.
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New GST Rate on Tractors & Agricultural Implements
The Government of India is updating GST rates effective after 22 Sep 2025. Below are the expected new GST rates for tractors and related items (no compensation cess), aligned with the agriculture-focused rationalisation.
Most items earlier at 12% are expected to move to 5% in this category; existing exemptions continue.
HSN Code and New GST Rate on Tractors
| Item | HSN Code | New GST Rate |
|---|---|---|
| Tractors (without accessories) | 8701 | 0% (Exempt) |
| Tractor parts and accessories | 8708 | 5% |
| Tractor tyres | 4011 | 5% |
| Tractor trailers | 8716 | 5% |
| PTO Shafts and Drive Shafts | 8483 | 5% |
| Agricultural Implements (attached) | 8432 | 5% |
Note: Rates shown are the expected post–22 Sep 2025 GST rationalisation for agriculture. Where an item previously had 12%, it’s moved to 5% here; tractor exemption remains.
Is GST Applicable on Tractors?
Here’s the good news: Tractors are exempt from GST when sold without accessories or attachments. This means if you buy a basic tractor, you don’t have to pay GST on it.
HSN Code and Old GST Rate on Tractors
(Old GST Rates – Applicable Until 21st September)
| Item | HSN Code | GST Rate |
|---|---|---|
| Tractors (without accessories) | 8701 | 0% (Exempt) |
| Tractor parts and accessories | 8708 | 28% |
| Tractor tyres | 4011 | 18% |
| Tractor trailers | 8716 | 18% |
| PTO Shafts and Drive Shafts | 8483 | 18% |
| Agricultural Implements (attached) | 8432 | 12% |
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GST on Tractor Parts and Accessories
While the main tractor unit enjoys tax exemption, its parts and accessories are taxable. Here’s how tractor GST rate varies depending on the item:
- Tyres and tubes – 18% GST
- Tractor trolleys and trailers – 18% GST
- Spare parts – 28% GST
- Attachments like rotavators, harrows, and seeders – 12%
So, even though the base vehicle is exempt, the overall cost may still include GST if additional parts are purchased.
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GST on Tractor Tyres and Tubes
One commonly asked question is about GST on tractor tyres. Tyres are essential for operations and do not fall under the exemption. The GST rate is 18%, which also applies to tubes and flaps.
For farmers and dealers, this means that while buying a tractor may be tax-free, replacing tyres or purchasing additional wheels will attract GST.
GST on Tractor Implements and Attachments
Implements such as cultivators, disc harrows, rotavators, and seed drills are taxed at 12% GST. These are considered agricultural tools and not part of the tractor itself.
If you’re buying a tractor with attachments already fixed, the whole package might be taxed. So it’s better to purchase them separately when possible.
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GST Exemption Benefit for Farmers
The GST exemption on tractors gives a big financial relief to farmers. Here’s how:
- Lower upfront cost on the primary vehicle
- No GST-related paperwork for the tractor unit
- Encouragement to invest in modern equipment
This exemption makes agricultural mechanization more affordable and helps small and marginal farmers upgrade their tools.
Conclusion
Understanding the GST rate on tractor purchases and accessories helps farmers and dealers manage costs wisely. While the tractor may be exempt, it’s important to plan for taxes on tyres, parts, and attachments. This knowledge ensures full compliance and smarter buying decisions.
I am a Chartered Accountant with more than five years of experience in the accounting field. My areas of expertise include GST, income tax, and audits. I am passionate about sharing knowledge through blogs and articles, as I believe that learning is a lifelong journey. My goal is to provide valuable insights and simplify financial matters for individuals and business owners alike.
Frequently Asked Questions (FAQs)
- What is the GST rate on tractors in India?The GST rate is 0% for tractors sold without attachments.
- Is GST applicable on tractor tyres?Yes, GST on tractor tyres is 18%.
- What is the GST on tractor spare parts?Spare parts for tractors attract 28% GST.
- Are attachments like rotavators taxed separately?Yes, most agricultural implements used with tractors are taxed at 12%.
- Why are tractors exempt from GST but parts are not?The tractor is considered a necessity for farming, so it’s tax-exempt. But accessories and parts are treated separately under GST rules.
