GST Rates & HSN Codes – Know about all GST Tax Rates & SAC Codes in India for 2018

GST Rates & HSN Codes – Know about all GST Tax Rates & SAC Codes in India for 2018

GST council has made the much-awaited announcements around tax rates on various categories of goods on 18th January 2018 at Vigyan Bhavan, Delhi. There has been a hype around these rates for a while and now these rates are finally in the public domain.

As soon as the GST rates were announced a huge wave of curiosity hit across industry and trade bodies. Everyone is evaluating their position as a result of this change. So in this article, we bring you our analysis of these GST rates.

Latest Update:

As per 25th GST Council meeting on 18th January 2018

*Note that Rate changes, Exemptions and other proposals made shall be given effect once the Notifications are issued for the same.

Rates for 29 Goods and 53 Services have been revised*. Click here to read all updates of the meet.

• Goods taxed at 0%- Vibhuti, De-oiled rice bran and parts used to manufacture hearing aids
• Reduced from 28% to 18%- Old and used motor vehicles [medium and large cars and SUVs] without ITC, Public transport Buses that run on Biofuel, Services of joy rides, Go-karting
• Reduced from 28% to 12% –Old and used motor vehicles [other than medium and large cars and SUVs] without ITC
• Reduced from 18% to 12% –Drinking water packed in 20 litres bottles, Drip irrigation system, sprinklers, Biodiesel, Sugar boiled Confectionery, Services of construction of metro / mono-rail, mining of petrol crude
• Reduced from 18% to 5% –LPG for household use, Tamarind Kernel Powder, Mehendi paste in cones, Raw materials and Consumables needed for Launch vehicles/satellites, Services of Tailoring
• Reduced from 12% to 5%-Velvet fabric( Without Refund of ITC), Articles of straw, of esparto or of other plaiting materials
• Reduced from 3% to 0.25%-Diamonds and precious stones
• Rate Increased from 0% to 5%-Rice bran (other than de-oiled rice bran)
• Rate Increased from 12% to 18%-Cigarette filter rods
• Services included in the Exemption List: 
  • Providing information under RTI Act, 2005
  • Legal services provided to Government
  • Admission to, or conduct of examination provided to all educational institutions including any service of conducting entrance examinations  on collection of entrance fees

Latest Update:

As per 23rd GST Council meeting on 10th November 2017

Rates for 178 items have been reduced from 28% to 18%. Click here to read all updates of the meet.

• GST Rate for manufacturers and traders under composition scheme is 1 %
• Reduced from 28% to 18% W.e.f. 15th Nov 2017 – Shampoo, Perfume, tiles, watches
• Reduced from 28% to 12% – Wet grinders, tanks
• Reduced from 18% to 12% – Condensed milk, refined sugar, diabetic food
• Reduced from 12% to 5% – Desiccated coconut, idli dosa batter, coir products
• Reduced from 5% to Nil – Duar meal, khandsari sugar, dried vegetables
• For Restaurants within hotels, and room tariff less than Rs. 7,500 the GST rate is 5%. Also, the credit of  ITC paid on inward supplies cannot be taken.
• For Restaurants within hotels, and room tariff greater than Rs. 7,500 the GST rate is 18% and credit of  ITC paid on inward supplies can be availed.
• Outdoor catering continues to be charged at 18% with the availability of ITC on inward supplies.

We already know that the GST slabs are pegged at 5%, 12%, 18% & 28%. According to the latest news from the GST council, the tax structure for common-use goods are as under:

GST Rates Structure

Tax Rates	Products
0%	Milk	Kajal
	Eggs	Educations Services
	Curd	Health Services
	Lassi	Children’s Drawing & Colouring Books
	Unpacked Foodgrains	Unbranded Atta
	Unpacked Paneer	Unbranded Maida
	Gur	Besan
	Unbranded Natural Honey	Prasad
	Fresh Vegetables	Palmyra Jaggery
	Salt	Phool Bhari Jhadoo
5%	Sugar	Packed Paneer
	Tea	Coal
	Edible Oils	Raisin
	Domestic LPG	Roasted Coffee Beans
	PDS Kerosene	Skimmed Milk Powder
	Cashew Nuts	Footwear (< Rs.500)
	Milk Food for Babies	Apparels (< Rs.1000)
	Fabric	Coir Mats, Matting & Floor Covering
	Spices	Agarbatti
	Coal	Mishti/Mithai (Indian Sweets)
	Life-saving drugs	Coffee (except instant)
12%	Butter	Computers
	Ghee	Processed food
	Almonds	Mobiles
	Fruit Juice	Preparations of Vegetables, Fruits, Nuts or other parts of Plants including Pickle Murabba, Chutney, Jam, Jelly
	Packed Coconut Water	Umbrella
18%	Hair Oil	Capital goods
	Toothpaste	Industrial Intermediaries
	Soap	Ice-cream
	Pasta	Toiletries
	Corn Flakes	Computers
	Soups	Printers
28%	Small cars (+1% or 3% cess)	High-end motorcycles (+15% cess)
	Consumer durables such as AC and fridge	Beedis are NOT included here
		Luxury & sin items like BMWs, cigarettes and aerated drinks (+15% cess)

 

In addition to the above, a few other items were mentioned in the Council’s announcement of rates. These items, and the applicable rates on them are as follows:

Sugar, Tea, Coffee and Edible oil will fall under the 5 per cent slab, while cereals, milk will be part of the exempt list under GST. This is to ensure that basic goods are available at affordable prices. However, instant food has been kept outside this bracket so, no relief for Maggie lovers!

• The Council has set the rate for capital goods and industrial intermediate items at 18 per cent. This will positively impact domestic manufacturers as seamless input credit will be available for all capital goods. Indeed, it is time for “Make In India”.

• Coal to be taxed at 5 percent against current 11.69 percent. This will prove beneficial for the power sector and heavy industries which rely on coal supply. This will also help curb inflation. Expect a good run for Coal India tomorrow.

• Toothpaste, hair oil, and soaps will all be taxed at 18 percent, where currently they are taxed at 28 percent. Most of the cosmetics and fast moving consumer goods (FMCG) brands should get the benefit of this tax reduction. After all, Fair and Lovely might seem fairer in its pricing from now on!

• The ‘mithai’ from the neighbouring sweet shop might lose some of its flavor as Indian sweets will now be taxable at 5 per cent. If you have a sweet tooth, this could hurt your pocket a wee bit in the coming days.

Plus, it was announced that:

• for restaurants serving alcohol, the tax bracket will be 18 per cent

• education, healthcare are going to be exempted from GST

• services on Non-AC restaurants will be 12 per cent