Indian GST rates - Avalara

Goods and Services Tax (GST) in India is a value-added tax levied on the manufacture, sale, and consumption of goods and services in the country. It’s payable at the final point of consumption.

At each stage of the supply chain, GST is collected on value-added goods and services via a tax credit mechanism.

Goods and services tax

There are a number of different GST rates in India that apply to different categories of goods and services. These are outlined by the Indian GST Council as:

28% — for luxury items
18% — for electronics and most services
12% — for clothing, certain foods, and medicines
5% — for essential goods such as food and life-saving medicines

There is also a nil rate imposed on several essential goods, such as food grains. Key rates are listed below:

Rate	Type	Which goods or services
28%	Higher	Consumer durables; air conditioning; automobiles; cement; chocolate; accommodation exceeding INR 7,500
18%	Standard	Telephony; banking; insurance; accommodation between INR 2,500 and INR 7,499 per night; restaurants with an alcohol licence; entrance to cultural and entertainment events; capital goods; heavily processed foods; cinema tickets; TVs; video cameras; games consoles; frozen vegetables; and engine parts
12%	Standard	Restaurants (non-air conditioned); business class air travel; construction; intellectual property; temporary transfers; dried fruit; confectionery; frozen meat; other foodstuffs; mobile phones; accommodation between INR 1,000 and INR 2,499 per night
5%	Reduced	Privately provided transport including car-sharing; advertising; sugar; tea and coffee; cooking oil; medicine; battery-operated car services
0%	Reduced	Basic foods, including: fish, meat, dairy, vegetables, bread, salt; postal services; books and newspapers; accommodation below INR999 per night

Exemptions

GST in India is not levied on petrol, high-speed diesel, motor spirit, natural gas, or aviation fuel. These items may however still be liable for excise duty.

GST Council

The Goods and Services Tax Council (GST Council) is the administrative body responsible for managing all aspects of GST in India, including decisions on tax rates. The GST Council amends or enacts laws and regulations relating to GST in India. The council also constantly monitors the implementation of GST across the country, reviews tax collection procedures, and makes corrections where necessary.

GST registration

Businesses must register for GST if their annual turnover exceeds INR 2 million for service supply or INR 4 million for goods supply. Foreign businesses that supply goods and services in India must register for GST.

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