Transportation of Goods under GST

Shobhit Gupta , Last updated: 19 June 2017  
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TRANSPORTATION OF GOODS

Transportation has very important role in civilization of human beings and the development of a country. Transportation of goods has a vital part in development of a business. Availability of raw material, packing material and plant and machinery from different part of the world and making the finished goods available to the customer in different part of the world depends upon the transportation system. Goods become cheaper and expensive depending on the transportation cost. To keep this mind, government has given separate rates of transportation of goods and some of the transportation of goods are exempted from GST.

Goods are transported by using three means of transportation:-

  • By Air
  • By Water
  • By Road
  1. Rail
  2. GTA
  3. Other modes

Transport of goods by Air


S. No.

Particulars

Whether taxable or not under GST?

Tax rate

1.

Within India

Yes

18%

2.

From India to outside India

Yes

18%

3.

From outside India to India

Exempt  Service

Exempt Service


Transport of goods by water


S. No.

Particulars

Whether taxable or not under GST?

Tax rate

1.

Within India (inland waterways).

Exempt  Service

Exempt Service

2.

From India to outside India.

Yes

18%

3.

From outside India to India

Exempt service

Conditions:

i. Service provided by a person located in non taxable territory.

ii. Services provided to a person located outside the taxable territory.

iii. Transportation of goods is done in a vessel.

Exempt service

Conditions:

i. Service provided by a person located in non taxable  territory.

ii. Services provided to a person located outside the taxable territory.

iii. Transportation of goods is done in a vessel.


Transport of goods by Road


S. No.

Particulars

Whether taxable or not under GST?

Tax rate

1.

By rail other than container.

Taxable

5% with ITC on input service.

2.

By rail in container

Yes

12% with ITC on input service.

3.

By Goods Transport Agency

Yes

5% with NO ITC.

4.

Services of goods by courier agency

Yes

18% with ITC credit.

5.

Other than Rail, GTA and courier agency.

Exempt Service

Exempt Service


What is Goods Transport Agency: means any person who provides service in relation to transport of goods by road and issues consignment note, by whatever name called. 

Exceptions:-

Services by way of transportation by rail or a vessel  from one  place  in India to another of the following  goods -

  1. relief materials meant for victims of natural or man-made disasters, calamities, accidents or mishap;
  2. defence or military  equipments;
  3. newspaper or magazines registered with the Registrar of Newspapers;
  4. railway equipments or  materials;
  5. agricultural  produce;
  6. milk, salt and food grain including flours, pulses and rice; and
  7. organic manure.

Services provided by a goods transport agency, by way of transport in a goods carriage of,-

  1. agricultural produce;
  2. goods, where gross amount charged for the transportation of goods on a consignment transported in a single carriage does not exceed one thousand five hundred rupees;
  3. goods, where gross amount charged for transportation of all such goods for a single consignee does not exceed rupees seven hundred fifty;
  4. milk, salt and food grain including flour, pulses and  rice;
  5. organic manure;
  6. newspaper or magazines registered with the Registrar of Newspapers;
  7. relief materials meant for victims of natural or man-made disasters, calamities, accidents or mishap; or
  8. defence or military equipment's.

Reverse Charge in case of GTA: Normally a service provider is required to pay taxes, but in case GTA provides the services to the following persons, recipient of services is required to pay GST under reverse charge:-

  1. any factory registered under or governed by the Factories Act,1948;
  2. any society registered under the Societies Registration Act, 1860 or under any other law for the time being in force in any part of India;
  3. any co-operative society established by or under any law;
  4. any person registered under CGST/SGST/UTGST Act;
  5. any body corporate established by or under any law; or
  6. any partnership firm whether registered or not under any law including association of persons;
  7. casual taxable person.
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Shobhit Gupta
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Category GST   Report

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Comments

14 July 2017 satwick

i m a dealer and also registered under GST and i want to transport the goods on own commercial vehicle free of cost interstate sale then what documents is required under gst .


13 July 2017 Mayank Raja

Dear Expert, My query is we are selling goods & also providing the transportation, whether TDS will be applicable on freight charged in the same invoice separately.


12 July 2017 Mahendra

Trader can claim GST paid under RCM GST in case of Transportation of Goods by Road, will be on Reverse Charge basis, so person who provides Transportation by issuing Consignment note will not charge GST, it will be person who is receiving the transportation service will have to pay GST under RCM. In case of transportation place of supply (for registered customer) will be place of location of recipient. It means if the shipment is moving from Bangalore to Delhi, but transporter and customer both are based in Mumbai, then it will be CGST + SGST. If transporter and customer is based in different state then IGST


12 July 2017 Bhanudas

Dear Sir, We provides service i.e. "Transporation of Goods by road" If our office located at mumbai and loading Equipment loading at Bangalore and place of service /Destination is Delhi then IGST 5% applicale please correct me. advice


10 July 2017 Broshanlal Chemicals

I am a trader


10 July 2017 Mahendra

Yes Manufacturer who is paying under Reverse Charge Mechanism can claimed Input Tax Credit. Restriction of non availability of Input Credit is on the transporter, so transporter can not claim Input Tax Credit while providing transportation service, since its output supplies is not taxable in their hands.


04 July 2017 Manindra Nath

When a manufacturer pays the GST @ 5% on GTA due to reverse charge scheme, then whether he (the manufacturer) will be eligible for its ITC? Confusion arises as the rate of tax is 5% without ITC. In case of manufacturer or other liable person to pay the tax on reverse charge, it will be mandatory to pay in cash and not through credit account and so he should be eligible to avail the credit of such reverse charge payment as was available in Service Tax regime.


20 June 2017 Mahendra

Eway bill rule is differ for some period of time as per latest rule uploaded in CBEC-GST site, as the contract is given to development of Eway system. Till such time government will by way of notification prescribed the documents require for transportation by the transporter.


20 June 2017 Mahendra

For GTA tax will be 5% with No ITC, it means person providing transport services can not claim ITC on its input services which are directly or indirectly linked with such Output GTA services (GTA Service will be under reverse charge )


20 June 2017 ejaz

Dear Sir, We have our two companies and in which we manufacture different types of materials, but a material is common manufacturing item in both companies. In order to reduce our transportation cost we used to same vehicle (own vehicle not through transport) at a time to deliver the materials from both companies to our clients (clients may be same or not). Now we want to know the procedure of eway bill in same scenario on GST implemetation. Thanks Ejaz Ahmad


20 June 2017 Manjunath T S

if a transport agent is a provider of transportation services by receiving such services i.e transport services from unregistered person, then what would be taxation?


20 June 2017 dipak adsule

We are Cement CFA and Transporter, our working area are in 2 states likes Maharashtra & Madhya Pradesh, we registered in GST but its only for Maharashtra state, then how we registered Madhya Pradesh also.


20 June 2017 Mayank Raja

Does 5 % with No ITC means no ITC to GTA, if yes from where we can find the same.


20 June 2017 Mahendra

Ocean freight (Import & Export - both) if billed to an Indian Customer will attract 5%, whereas for export air freight billed to an Indian Customer will attracts 18%. However if these 3 billed for foreign customer then will be zero rated provided export of service conditions satisfied. Air freight on import will not be liable for GST.


20 June 2017 Mahendra

Pls refer the GST tax rate announced for services. It mentioned "Transport of goods in a vessel including services provided or agreed to be provided by a person located in non-taxable territory to a person located in non-taxable territory by way of transportation of goods by a vessel from a place outside India up to the customs station of clearance in India" with a rate of 5% (with ITC on Input Services)


20 June 2017 C.H.MENON

Not sure whether freight by air and sea for exporters will be subject to GST.If yes what is the %


19 June 2017 yogesh

casual taxable person ?? any specific detail


19 June 2017 Shobhit Gupta

Can you provide reference.....Thanks


19 June 2017 Mahendra

Ocean Transport will be @5% for both Import and Export


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