Tax authorities mandate TDS registration for specific scrap and waste dealers

The Goods and Services Network has advised dealers handling metal scrap, used cooking oil, plastic, tyre, and e-waste scrap to secure a Tax Deducted at Source registration using form GST REG-07. This compliance requirement takes effect from November 2026 and is officially governed under Notification 07/2026. The directive extends mandatory registration rules to these specific categories of waste and secondary material traders across the marketplace. Tax Deducted at Source mechanisms in the indirect tax framework function as a monitoring tool to capture transactions within supply chains involving unorganized or semi-organized sectors.

Previously, many scrap and secondary material categories operated outside rigorous TDS tracking, leading to leakage in reporting. Under the updated mandate, affected businesses must transition from standard registration assumptions to active TDS compliance, changing how these dealers interact with institutional buyers who deduct tax at the source. Practitioners should immediately review client portfolios in the metal, plastic, tyre, and e-waste recycling sectors to identify entities requiring registration in form GST REG-07 ahead of the November 2026 deadline.

Tax professionals must assist clients in filing the necessary applications and adjusting accounting software to handle TDS deductions correctly. Timely compliance prevents transaction holds and protects clients from regulatory penalties tied to the new notification. Ensure your clients complete their registration well before November 2026 to safeguard their supply chain relationships.