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GST impact: Trucks' travel time in interstate movement drops 20%, says govt

The unified tax regime has obviated the need for inter- state check posts

Press Trust of India 


Post-GST, time for long-haul have reduced by at least a fifth, Ministry of Road and Highways has said.
"A typical truck spent 20 per cent of its runtime at interstate checkposts (pre GST)...Inter-state check posts removed, travel time of long-haul trucks, other cut by at least one-fifth," the Ministry has said in a recent report.
On an average, a truck in runs an annual distance of 60,000 kms, as against 200,000 km in the West.
The Ministry said earlier took 50-65 hours in reaching Kolkata from Chennai and the time now stands reduced by 20 per cent.
This was corroborated from interviews with transporters as well as GPS of express transporters.
Road and Highways Minister Nitin Gadkari, had last week said that India's sector stands to gain the most under the regime as costs will dip by almost 20 per cent.
The Ministry said that pre-GST, the complex tax structure and forced the industry to spend a lot of resources on and deposit of inter-state
Monitoring and collection of at inter-state check posts led to major traffic congestion at these points, resulting in slower movement of and passenger, and consequently higher costs and pollution, it said and added, an average Indian truck covers only about 50,000-60,000 km a year as against 3 lakh km done by a truck in the US.
The unified tax regime has obviated the need for inter- state check posts. This will result in reducing time of long-haul and other by at least one- fifth, the report said.
"This, coupled with the proposed E-way bill that will require online registration for movement of worth more than Rs 50,000, will ease the movement of further and bring in more to the whole process. Efficient movement will also boost the demand for high tonnage trucks, which will, in turn, reduce the cost of of freight," the report said.
A single regime also means an optimised warehousing structure.
Earlier, companies had to maintain warehouses in every state due to different taxation slabs. does away with the need to have such separate warehouses. This means, a leaner and smarter chain. This will also encourage more in the warehousing business.
Pre-GST, the statutory for most worked out to about 26.5 per cent.
"Post-GST, most are expected to be in the 18 per cent tax range," the government said.
currently has very high cost -– about 14 per cent of the total value of goods, as against 6-8 per cent in other major countries.
will serve to bring down the cost to about 10-12 per cent by facilitating efficient inter-state flow of and accelerating the demand for