Begin typing your search above and press return to search.

Benefits of GST for the Transport Sector

Sentinel Digital DeskBy : Sentinel Digital Desk

  |  27 July 2017 12:00 AM GMT

New Delhi, July 26: The transport sector stands to benefit from the recently rolled out GST in several ways. The unified tax regime has obviated the need for inter state check posts. This will result in reducing the travel time of long-haul trucks and other cargo vehicles by at least one-fifth. This, coupled with the proposed E-way bill that will require online registration for movement of goods worth more than Rs 50,000, will ease the movement of freight further, and bring in more transparency in the whole process. Efficient freight movement will also boost the demand for high tonge trucks, which will in turn reduce the cost of transportation of freight. Pre- GST, the statutory tax rate for most goods worked out to about 26.5%. Post GST most goods are expected to be in the 18 % tax range . India currently has very high logistics cost – about 14% of the total value of goods as against 6-8% in other major countries. GST will serve to bring down the logistics cost to about 10-12 % by facilitating efficient inter-state flow of goods and accelerating the demand for logistics services. According to Nitin Gadkari, the Minister for Road Transport & Highways and Shipping, India’s logistics sector would gain the most from the Goods and Services tax as costs would fall by almost 20%. He has also said that logistics parks are being set up at various places across the country to act as freight aggregation and distribution hubs. These logistics parks will eble long haul freight movement between hubs on larger sized trucks, rail and waterways. This will not only reduce freight transportation costs, but also throw open many employment opportunities and reduce pollution levels. The Ministry of Road Transport and Highways has prepared a booklet on the benefits of GST for the transport sector. This was stated inb a press release.


Next Story