Taxes burden tyre retreading industry
 
Tyre retreading industry is essentially tyre recycling process.  In western countries tyres cannot be put in land fills and must be recycled in various ways.  The government offers numerous incentives to recyclers to dispose off these worn-out tyres. 
 
In India, the tyre retreading industry does not receive any tax incentives, but instead is burdened by numerous taxes like Vat, service tax and excise. Vat is charged on the material sold in the retreading process, ranging from 2 per cent to 12.5 per cent in various states. 
 
Service tax is charged on retreading and at present the service tax department is also claiming service tax on the material component where Vat is also paid.
 
The raw material input for the retreading requires excise of 16 per cent along with educational cess, higher secondary educational cess and also Vat is charged on this material, ranging from 4 per cent to 12.5 per cent. 
 
If government would like to help protect environment, the first step could be an exemption from all the taxes for the retreading industry. Many retreaders have gone one step further and now use boilers fired with agrowaste. This step has eliminated the use of fossil fuels in the retreading process.
 
Tyresoles has taken the recycled business forward and created recycled rubber flooring from used tyres that cannot be retreaded. Thus they have completed the recycle process.
 
When a truck tyre is retreded it results in a saving of 20 ltrs of crude oil.  There is an estimated 100 lakh tyres retreaded every year in the country.  Isn’t it an astonishing 2,000 lakh litres of crude oil saved in a year?
 
Contributed by:
Tyresoles. For more information
contact: Mr. Karun Sanghi –MD, Tyresoles,
Devidayal Complex, Kanjurmarg (East), Mumbai -400042
Tel: +91-22-25784053/63.
shetty.r@tyresoles.com, www.tyresoles.com