GST Cut on Tractors and Agricultural Equipment: Govt to Ensure Farmers Get Full Benefit

The government has reduced the GST rate on tractors and agricultural machinery from earlier slabs of 12-18% down to 5%, effective 22 September 2025. In a meeting led by the Agriculture Minister, ministerial and industry stakeholders (Tractor & Mechanization Association, Agricultural Machinery Manufacturers Association, etc.) discussed ensuring that these GST cuts translate directly into reduced prices for farmers. The stated expected price reductions are around 7-13% for machinery/tractors. In addition, ancillary benefits such as reduced costs on spare parts, tyres, etc., are expected. The government emphasised transparency and accountability to ensure that manufacturers and sellers pass on the tax savings rather than retain them.