Major Win For Defence: GST Scrapped On Weapons, Aircraft; Drones Slashed to 5%

New Delhi: Chief of the Army Staff, General Upendra Dwivedi, on Friday said the GST reforms will give our defence corridors a major boost, as we can now make greater investments and expect better results.

In a major boost to the defence sector, the Goods and Services Tax (GST) on several weapons, military aircraft, and equipment has been completely abolished.Additionally, the GST on drones has been slashed drastically from 28 per cent to 5 per cent.Speaking at an event here, Dwivedi thanked the government for GST reforms.

"The biggest benefit is that our defence corridors will get a major boost, as we can now make greater investments there and expect double the results. Similarly, MSMEs and startups, which usually face a shortage of funds, will now find it easier to invest in research, development, manufacturing, and upgradation of equipment for the Indian Army," he said.

Under the GST 2.0 regime, several weapons earlier under the 18 per cent GST slab have now been moved to the nil GST category.These include military transport aircraft such as the C-130 (procured from the US) and the C-295 medium transport aircraft (jointly manufactured by Airbus and Tata in Vadodara).

Moreover, GST has also been removed on missiles launched from Remote Pilot Aircraft (RPAs) used by the armed forces.GST has been eliminated on GSAT systems, ship-launched missiles, flight motion simulators, underwater vessels, and fighter jet ejection seats, which allow pilots to exit safely during emergencies.

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