GST on Transport: GST Rates for Transport Sector

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Knowing about GST on Transport is very important for us. The reason is Transportation is a crucial part of our economy. In this article, we will understand the GST on Transport. Besides, we will also have a look at Rates for Transport Sector under Goods and Service Tax.

Know about GST

As the name suggests, The Goods and Services Tax (GST) is a tax imposed on the supply of goods and services. The GST tax imposed is a blend of the CGST and the SGST, which are the central GST and the State GST.

The primary goal of this tax structure is to manage the cascading effects of other indirect taxes. For instance, The GST on Transport eliminates other indirect taxes, including service tax, excise duty, VAT, etc.

GST onTransport Sector

The GST Rates are different for different goods and services. The same applies to GST Rates for the transport sector. Each medium attracts different GST Rates. Let’s have a look at each of them.

GST on Transport by Road

Roads are the most widely used transportation network in the nation. The extensive road network across the country ensures that transit to the far most regions of the country is faster and more efficient.

Transport Service Rates of Goods and Service tax on Transport by Road
Public Transport for passengers NIL
Transport through metered auto-rickshaw, e-rickshaw or taxi NIL
Transport through Non-AC Contract Carriage or Stagecoach NIL
Transport through AC Contract Carriage or Stagecoach (without Input Tax Credit) 5%
Transport through radio taxi and similar other services 5%
Transport through rental services for cars, buses, coaches,  18%

GST on Transport by Rail

India boasts the world’s most solid rail network. Likewise, Rail transports are seen as a significantly faster and cheaper transport method. Furthermore, almost every perishable product gets transportation by trains in India.

Transportation Service Rates of Goods and Services tax for Transport by Rail
AC and First Class Train Tickets 5%
Sleeper and general class tickets 5%
Metro Tickets or Tokens 12%

GST on Transport by Air

Air transport is an emerging sector in India. It is the fastest transportation method. Accordingly, it is also the costliest one. Besides that, the customers have to pay an extra charge for handling too.

Transportation Service Rates of Goods and Services Tax for Transport by Air
Economy Class Tickets 5%
Tickets of chartered flights for the purpose of pilgrimage 5%
Business class air tickets 12%
Rental Services of aircraft (with or without operator)/chartered flights 12%

Know about Tax Exemption on Transport Services of Goods

The Goods and Services Tax is exempted on several goods transportation. For instance, transport of –

  • Pulses, milk, salt, flour, rice, and other food grains
  • Newspapers/magazines registered with Registrar of Newspapers
  • Military or Defense equipment
  • goods of individual not having GST Registration

In addition, GST Exemption also applies when the payment of transport services is less than Rs. 1500.

Important Note: GTA and Courier Agencies are also under GST Exemption in India

GST on Export of Goods & Services

If you want any other guidance related to GST Registration or GST Return filing, please feel free to talk to our business advisors at 8881-069-069.

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