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HSN Code: Definition, Usage, Lists & Structure

Find HSN Codes & GST Rates of goods and services under GST in India. Under GST, tax slabs have been fixed at 0%, 5%, 12%, 18% and 28%

The implementation of the Goods and Services Tax (GST) in India has brought significant changes to the country’s taxation system. Among the key components of GST are Harmonized System of Nomenclature (HSN) codes and GST rates. In this comprehensive guide, we will delve into the intricacies of HSN codes, their significance, structure, and their role in determining GST rates in India.

What are HSN Codes?

HSN codes are an internationally recognized system for classifying goods in a systematic and logical manner. These codes are used to categorize products based on their characteristics, composition, and other distinguishing features. The primary purpose of HSN codes is to streamline international trade by providing a common language for customs declarations and tariff determination.

How do HSN Codes Work?

HSN codes typically consist of six to eight digits, with each digit representing a specific category or classification detail. The first two digits denote the chapter, the next two indicate the heading, and subsequent digits specify the sub-heading or product detail. This hierarchical structure enables precise classification of goods, facilitating uniformity and consistency in trade transactions.

Significance of HSN Codes

HSN codes play a crucial role in the GST regime by determining the tax rates applicable to various goods. They help in the accurate calculation of taxes and ensure compliance with regulatory requirements. By categorizing goods into distinct groups, HSN codes simplify tax administration and facilitate seamless cross-border trade.

HSN Codes Worldwide

The HSN system is used by over 200 countries worldwide, providing a standardized method for classifying goods. Its universal adoption promotes transparency, efficiency, and accuracy in international trade. By harmonizing classification standards, HSN codes facilitate smoother customs procedures and reduce trade barriers.

HSN Codes in India

In India, HSN codes are extensively utilized under the GST regime for the classification of goods. Businesses are required to declare the appropriate HSN codes for the goods they supply, which helps in determining the applicable GST rates. Proper declaration of HSN codes is essential for accurate tax calculation and reporting.

Understanding the HSN Code Structure in India

The HSN code structure in India follows a hierarchical format, with each digit representing a specific level of classification. The first two digits denote the chapter, followed by the heading, sub-heading, and so on. This structured approach enables efficient categorization of goods and simplifies tax administration under GST.

Services Accounting Code (SAC) in GST

In addition to HSN codes for goods, the GST regime also incorporates Services Accounting Codes (SAC) for the classification of services. SACs serve a similar purpose to HSN codes but are specifically designed for service-oriented transactions. They help in determining the applicable tax rates for various services under GST.

Declaration of HSN Codes for Goods and SAC for Services

Businesses are required to include HSN or SAC codes in their GST invoices and returns to ensure compliance with regulatory requirements. Proper declaration of these codes is crucial for accurate tax calculation and reporting. Failure to declare the correct codes may lead to penalties and other legal consequences.

Importance of HSN Codes under GST

HSN codes play a vital role in the GST system by facilitating uniform tax classification and calculation. They enable efficient tax administration and help businesses comply with GST regulations. Proper understanding and application of HSN codes are essential for smooth GST compliance and tax reporting.

HSN-wise Summary of Outward Supplies

Businesses often generate HSN-wise summaries of their outward supplies to track sales trends, analyze product performance, and ensure accurate tax reporting. These summaries provide valuable insights into business operations and aid in strategic decision-making. By categorizing outward supplies based on HSN codes, businesses can identify revenue streams, assess market demand, and optimize their product offerings.

 

Chapter Description
Chapter 01 Poultry and Live Animals
Chapter 02 Meat and Edible Meat Offal
Chapter 03 Fish and Crustaceans, Molluscs and Other Aquatic Invertebrates
Chapter 04 Dairy Produce; Birds' Eggs; Natural Honey; Edible Products of Animal Origin, not elsewhere specified or included
Chapter 05 Products of Animal Origin, not elsewhere specified or included
Chapter 06 Live Trees and Other Plants; Bulbs; Roots and the like; Cut Flowers and Ornamental Foliage
Chapter 07Edible Vegetables and Certain Roots and Tubers
Chapter 08 Edible Fruit and Nuts; Peel of Citrus Fruit or Melons
Chapter 09Coffee, Tea, Mate and Spices
Chapter 10Cereals
Chapter 11Products of the Milling Industry; Malt; Starches; Inulin; Wheat Gluten
Chapter 12Oil Seeds and Oleaginous Fruits; Miscellaneous Grains, Seeds and Fruit; Industrial or Medicinal Plants; Straw and Fodder
Chapter 13Lac; Gums, Resins and Other Vegetable Saps and Extracts
Chapter 14Vegetable Plaiting Materials; Vegetable Products not elsewhere specified or included
Chapter 15Animal or Vegetable Fats and Oils and their Cleavage Products; Prepared Edible Fats; Animal or Vegetable Waxes
Chapter 16Preparations of Meat, of Fish or of Crustaceans, Molluscs or Other Aquatic Invertebrates
Chapter 17Sugars and Sugar Confectionery
Chapter 18Cocoa and Cocoa Preparations; Edible Preparations containing Cocoa
Chapter 19Preparations of Cereals, Flour, Starch or Milk; Pastrycooks' Products
Chapter 20Preparations of Vegetables, Fruit, Nuts or Other Parts of Plants
Chapter 21Miscellaneous Edible Preparations
Chapter 22Beverages, Spirits and Vinegar
Chapter 23Residues and Waste from the Food Industries; Prepared Animal Fodder
Chapter 24Tobacco and Manufactured Tobacco Substitutes
Chapter 25Salt; Sulphur; Earths and Stone; Plastering Materials, Lime and Cement
Chapter 26Ores, Slag and Ash
Chapter 27Mineral Fuels, Mineral Oils and Products of their Distillation; Bituminous Substances; Mineral Waxes
Chapter 28Inorganic Chemicals; Organic or Inorganic Compounds of Precious Metals, of Rare-Earth Metals, of Radioactive Elements or of Isotopes
Chapter 29Organic Chemicals
Chapter 30Pharmaceutical Products
Chapter 31Fertilisers
Chapter 32Tanning or Dyeing Extracts; Tannins and their Derivatives; Dyes, Pigments and other Colouring Matter; Paints and Varnishes; Putty and other Mastics; Inks
Chapter 33Essential Oils and Resinoids; Perfumery, Cosmetic or Toilet Preparations
Chapter 34Soap, Organic Surface-Active Agents, Washing Preparations, Lubricating Preparations, Artificial Waxes, Prepared Waxes, Polishing or Scouring Preparations, Candles and Similar Articles, Modelling Pastes, "Dental Waxes" and Dental Preparations with a Basis of Plaster
Chapter 35Albuminoidal Substances; Modified Starches; Glues; Enzymes
Chapter 36Explosives; Pyrotechnic Products; Matches; Pyrophoric Alloys; Certain Combustible Preparations
Chapter 37Photographic or Cinematographic Goods
Chapter 38Miscellaneous Chemical Products
Chapter 39Plastics and Articles thereof
Chapter 40Rubber and Articles thereof
Chapter 41Raw Hides and Skins (other than furskins) and Leather
Chapter 42Articles of Leather; Saddlery and Harness; Travel Goods, Handbags and Similar Containers; Articles of Animal Gut (other than Silkworm Gut)
Chapter 43Furskins and Artificial Fur; Manufactures thereof
Chapter 44Wood and Articles of Wood; Wood Charcoal
Chapter 45Cork and Articles of Cork
Chapter 46Manufactures of Straw, of Esparto or of other Plaiting Materials; Basketware and Wickerwork
Chapter 47Pulp of Wood or of other Fibrous Cellulosic Material; Recovered (Waste and Scrap) Paper or Paperboard
Chapter 48Paper and Paperboard; Articles of Paper Pulp, of Paper or Paperboard
Chapter 49Printed Books, Newspapers, Pictures and other products of the printing industry; Manuscripts, Typescripts and Plans
Chapter 50Silk
Chapter 51Wool, Fine or Coarse Animal Hair; Horsehair Yarn and Woven Fabric
Chapter 52Cotton
Chapter 53Other Vegetable Textile Fibres; Paper Yarn and Woven Fabric of Paper Yarn
Chapter 54Man-Made Filaments; Strip and the like of Man-Made Textile Materials
Chapter 55Man-Made Staple Fibres
Chapter 56Wadding, Felt and Nonwovens; Special Yarns; Twine, Cordage, Ropes and Cables and Articles thereof
Chapter 57Carpets and other Textile Floor Coverings
Chapter 58Special Woven Fabrics; Tufted Textile Fabrics; Lace; Tapestries; Trimmings; Embroidery
Chapter 59Impregnated, Coated, Covered or Laminated Textile Fabrics; Textile Articles of a Kind Suitable for Industrial Use
Chapter 60Knitted or Crocheted Fabrics
Chapter 61Articles of Apparel and Clothing Accessories, Knitted or Crocheted
Chapter 62Articles of Apparel and Clothing Accessories, not Knitted or Crocheted
Chapter 63Other made up textile articles; sets; worn clothing and worn textile articles; rags
Chapter 64Footwear, Gaiters and the like; Parts of such articles
Chapter 65Headgear and parts thereof
Chapter 66Umbrellas, sun umbrellas, walking-sticks, seat-sticks, whips, riding-crops and parts thereof
Chapter 67Prepared feathers and down and articles made of feathers or of down; artificial flowers; articles of human hair
Chapter 68Articles of stone, plaster, cement, asbestos, mica or similar materials
Chapter 69Ceramic products
Chapter 70Glass and Glassware
Chapter 71Natural or cultured pearls, precious or semi-precious stones, precious metals, metals clad with precious metal, and articles thereof; imitation jewellery; coin
Chapter 72Iron and steel
Chapter 73Articles of iron or steel
Chapter 74Copper and Articles thereof
Chapter 75Nickel and Articles thereof
Chapter 76Aluminium and Articles thereof
Chapter 78Lead and Articles thereof
Chapter 79Zinc and Articles thereof
Chapter 80Tin and Articles thereof
Chapter 81Other base metals; cermets; articles thereof
Chapter 82Tools, implements, cutlery, spoons and forks, of base metal; parts thereof of base metal
Chapter 83Miscellaneous articles of base metal
Chapter 84Nuclear reactors, boilers, machinery and mechanical appliances; parts thereof
Chapter 85Electrical machinery and equipment and parts thereof; sound recorders and reproducers, television image and sound recorders and reproducers, and parts and accessories of such articles
Chapter 86Railway or tramway locomotives, rolling-stock and parts thereof; railway or tramway track fixtures and fittings and parts thereof; mechanical (including electro-mechanical) traffic signalling equipment of all kinds
Chapter 87Vehicles other than railway or tramway rolling-stock, and parts and accessories thereof
Chapter 88Aircraft, spacecraft, and parts thereof
Chapter 89Ships, boats and floating structures, and parts thereof
Chapter 90Optical, photographic, cinematographic, measuring, checking, precision, medical or surgical instruments and apparatus; parts and accessories thereof
Chapter 91Clocks and watches and parts thereof
Chapter 92Musical instruments; parts and accessories of such articles
Chapter 93Arms and ammunition; parts and accessories thereof
Chapter 94Furniture; bedding, mattresses, mattress supports, cushions and similar stuffed furnishings; lamps and lighting fittings, not elsewhere specified or included; illuminated signs, illuminated name-plates and the like; prefabricated buildings
Chapter 95Toys, games and sports requisites; parts and accessories thereof
Chapter 96Miscellaneous manufactured articles
Chapter 97Works of art, collectors' pieces and antiques
Chapter 98Project imports, Laboratory chemicals, passenger's baggage, personal imports or imports by post
Chapter 99Commodities not elsewhere specified or included

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