Will Agricultural Machinery and Tractors Become More Affordable for Farmers?
Click to start listening
Synopsis
In a significant move to boost farmers' income, the Indian government has announced a drastic reduction in GST rates for agricultural machinery. This change, effective from September 22, aims to lower the costs of tractors and other essential farming equipment, enabling farmers to invest more in productivity. Discover the details and implications of this policy shift.
Key Takeaways
- GST on agricultural machinery has been reduced to 5%.
- Price drops on various tractors, up to Rs 63,000.
- Government aims to ensure transparency in the benefits delivered to farmers.
- Custom hiring centers are encouraged to lower rental rates.
- Information will be shared during the Viksit Krishi Sankalp Abhiyan.
New Delhi, Sep 19 (NationPress) The government has committed to enhancing farmers’ earnings, which involves both boosting productivity and minimizing costs, with mechanization being essential for achieving these goals, stated Union Agriculture Minister Shivraj Singh Chouhan on Friday.
During a meeting discussing the recent GST reforms for agricultural machinery, attended by industry representatives, Chouhan expressed gratitude to Prime Minister Narendra Modi for implementing the GST rate reductions.
He announced that the GST on agricultural machinery, previously set at 12 percent and 18 percent, will now be lowered to 5 percent, effective from September 22, providing a direct benefit to farmers.
The representatives from machinery manufacturers were informed that these reduced GST rates should transparently benefit the farmers.
Chouhan mentioned that the GST reduction is a significant advancement that will have extensive repercussions. He highlighted the considerable price decreases:
A 35 HP tractor will be reduced by Rs 41,000, a 45 HP tractor will drop by Rs 45,000, a 50 HP tractor will see a reduction of Rs 53,000, and a 75 HP tractor will be cheaper by Rs 63,000.
Moreover, smaller tractors utilized in horticulture and weeding will also experience price cuts. A 4-row paddy transplanter will be less expensive by Rs 15,400, while a 4-tonne-per-hour multi-crop thresher will see a price reduction of Rs 14,000. A 13 HP power tiller will also cost Rs 11,875 less.
Chouhan stated that the government will effectively communicate these advantages through various channels to ensure farmers are aware. He also stressed that custom hiring centers, which will receive machines at lower prices, need to decrease rental rates to maintain affordability.
Information regarding the GST rate reduction will be shared with farmers during the upcoming second phase of the ‘Viksit Krishi Sankalp Abhiyan’ for Rabi crops, commencing October 3, so they can capitalize on it for improved farming.
Point of View
It's essential to highlight how the government's latest initiative stands to benefit farmers significantly. The reduction in GST rates for agricultural machinery represents a proactive step toward alleviating financial burdens faced by farmers. By enhancing affordability and boosting productivity through mechanization, this policy could lead to a more prosperous agricultural landscape in India.
NationPress
20/09/2025
Frequently Asked Questions
What is the new GST rate for agricultural machinery?
The new GST rate for agricultural machinery has been reduced to 5% from the previous rates of 12% and 18%.
When will the new GST rate take effect?
The new GST rate will take effect from September 22.
How much will tractor prices decrease?
Prices for tractors will decrease significantly, with savings of up to Rs 63,000 on larger models.
How will farmers be informed about these changes?
The government plans to disseminate information through various communication channels during the second phase of the 'Viksit Krishi Sankalp Abhiyan' for Rabi crops.
What other equipment will see price reductions?
In addition to tractors, equipment like a 4-row paddy transplanter and multi-crop threshers will also see substantial price reductions.
