GST on Tyres – Tax Rates, HSN Codes & Price Impact

Raju was a wholesaler of tyres, which included tyres for both commercial and domestic usage. Whenever he sells a tyre, his invoice would consist of details related to different taxes.

Let’s say the base price of a single car tyre is ₹ 6,000. Now he would add the following details:

• Base Price of a tyre: ₹ 6,000
• VAT: 12.5%
• Central Sales Tax (CST): 18.5%

Total Cost: ₹ 7,998.75, which rounded off as ₹7,999

When the GST was implemented in 2017, these multiple taxations were replaced by this new regime, which incorporated a uniform taxation for the goods. Now, all the sellers and buyers can understand how this simple taxation works on each good and service.

This blog explains the GST on tyres.

 How Raju Calculated in Pre-GST Times?

Raju was a wholesaler who sold trucks to various companies, which also included commercial trucks and the aviation industry. In India, the tyres are classified into seven types:

• 4-wheeler tyres
• 2-wheeler tyres
• Cycle tyres
• Commercial transport tyres
• Agricultural-use tyres
• Aviation tyres

Each tyre incorporates different tax structures of Value Added Tax (VAT) and Central Sales Tax (CST), also invoiced as Other Tax in the bill copy. The rates levied by these structures vary from one state to another, according to the different states and their categories.

For example:

If Raju sells 100 two-wheeler tyres for a price of ₹ 2,500, then the following details need to be included:

• Base Price of a tyre: ₹ 2,500
• VAT: 12.5% (₹ 312.5), total ₹ 2,812.5
• Central Sales Tax (CST): 18.5%, total ₹ 3,332.81

Total Cost: ₹ 3,332.81, which can be rounded off as ₹ 3,333.

Taxations After GST

After the implementation of GST, the calculation of the tax amount becomes easier. Let’s say that Raju adds GST of 28% to the cost of one tyre, ₹ 2,500.

• Base Price: ₹ 2,500
• GST 28%: ₹ 700

Total Payable Amount: ₹ 3,200.

Now, with this simplified tax system, Raju invoices the total cost for a single tyre as ₹ 3,200.

Suppose Raju sells 100 tyres for the same price of ₹ 2,500, again, he needs to add 28% GST.

• Base Price of 100 Tyres: ₹ 2,50,000
• GST 28%: ₹ 70,000

Total Payable Amount: ₹ 3,20,000

All invoices must mention the total GST amount, and it should be furnished in the GST filing returns. This helps the government to prevent money laundering and tax evasion.

GST Rates and HSN Codes

Let’s say Raju sells three different types of tyres in 100 units, such as:

• Car Tyres
• Motorise Two-Wheeler Tyres
• Bus and Commercial Tyres

Each of the types attracts the GST rate of 28%. Suppose each of these tyres costs ₹ 5,500, ₹ 3,500, and ₹ 35,00,0, respectively. Then this is how the GST calculations work:

Suppose if he sells the tyres that attract different GST rates, he needs to do the same math calculation:

Though these tyres attract different GST rates, the invoice still needs to mention its charges for the GST filings.

Input Tax Credit (ITC) for Tyres 

The GST-registered retailers from the tyre business should be eligible for an ITC claim. They need to furnish the details of the invoice, which should consist of the HSN Code.

• Raju is a GST-registered retailer, so he can claim the ITC. His GSTIN can be like 33ABCDEF65412YU66.
• The invoice must have a number like RAJ-06-001.
• It must mention the date like 10.06.2025, and the HSN Code like 401110.
• Raju should file it in GSTR-1, and that should reflect the invoice of GSTR-2A.

For example:

Raju sells Motorised Two-Wheeler Tyres of 10 units, with a base price of ₹ 2,500, with 28% GST.

• Base price for 10 units: ₹ 25,000
• GST of 28%: ₹ 7,000

Total Payable Amount: ₹ 35,000

• Here, the total input tax is ₹ 7,000. This should be used to deduct the total output tax.

Suppose, let’s sa,y that Raju generated an output tax of ₹ 12,500 from the previous cycle of sales. Then this is how it works:

• = 12,500 – 7,000
• = ₹ 5,500

So the total tax payable is ₹ 5,500.

Conclusion

Before the implementation of GST, several tax structures created confusion and mismatched amounts, leading to tax evasion and money laundering. When GST was implemented, the taxation became simple and the same across all the states for selling the goods. Likewise, the GST-registered retailers were made to claim the ITC without any difficulties.

FAQs

1. What is the GST rate for Non-Motorised Two-Wheeler Tyres?

The GST for Non-Motorised Two-Wheeler Tyres is 5%.

2. Is it mandatory to register for GST filings?

If the aggregate turnover exceeds the threshold, then it is compulsory. However, the retailer should come under either the normal category or the special category, which have different sets of annual turnover.

3. What is the HSN code for car tyres?

The HSN code is 401110.

4. Should the invoice include the HSN?

All the invoices should include the HSN code, as GST rates are applied to a product.

5. What is the GST for Agricultural Vehicle Tyres?

The GST for agricultural vehicle tyres is 12%.
 

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