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GST on transport: Check GST rates for goods and passengers transportation, RCM on transportation

by | Last updated on: Mar 1, 2024 | Logistics

Transportation whether goods or passengers attracts GST. While doing business it is best to understand what kind of GST rate is applicable on goods you plan to move. The GST rate depends on the type of goods you are transporting, the mode of transport and so on. Here is more about GST on transportation.

GST on transport

Table of Contents

Whether good transport or passengers, both attract GST at different rates. Therefore, it is important to learn about the rates GST on transport.

Logistics

This article takes a closer look at GST rates for various modes of transportation (passengers as well as goods). Let’s begin with GST goods transport.

GST on goods transport (GST on transportation service)

Goods transportation attracts GST under the GST Act. The rates of GST transport services depend on various factors such as the type of goods, nature of the service, the mode of transport, etc. Here are the GST rates applied on good transport agency (GTA) services according to the type of transport used in India:

Type of transport GST rate
GST on road transport 5% GST
GST on rail transport 5% GST
GST on air transport 5% GST
GST on ship transport 5% GST
GST on courier services 18% GST
GST on inland waterways 0%

Note: The information mentioned above is indicative as GST rates are subject to change periodically.

Also read: GST calculator with formula

Goods exempted from GST on transport

Moreover, there are a few items, which are exempted from GST regardless of the mode of transport used.

  • Agricultural produce and organic manure
  • Pulses, milk, salt, flour, rice and other food grains
  • Newspapers/magazines registered with the Registrar of Newspapers
  • Military/defense equipment
  • Relief materials transported victims of natural calamities, mishaps, accidents, etc.
  • Transport of household goods for personal use
  • When the bill for transportation is less than ₹1500

Consignment note: A mandatory document for goods transportation

When goods are transported by road, GTA meaning a good transportation agency or a logistics company is expected to issue a consignment note. This consignment note usually has the following details:

  • Name of consignor
  • Name of consignee
  • Registration number of the goods carriage/vehicle in which the goods are transported
  • Details of the goods including type of goods, quantity, price, etc.
  • Place of origin
  • Place of destination
  • Person who is liable to pay GST – consignor, consignee, or the GTA.

A consignment note denotes that GTA has received goods for transportation purposes and is now responsible for the safety of goods. Moreover, it also documents the entity that is liable to pay GST – consignor, GTA or consignee.

Also read: Shipping bill: Meaning, details, format

What is RCM on transportation?

Full form of RCM is reverse charge mechanism. In the GST system when the liability of paying tax is transferred from the supplier to the recipient that is when RCM comes into play. In other words, in case of RCM, recipient of goods is liable to pay the GST applicable on transportation directly to the government of India.

GST rate on passenger transportation

Coming to GST on passenger transportation, some kind of passenger transportation attracts GST while some modes do not. Here are the details on which mode of transport attracts GST and how much.

GST on air transport

Particulars Rate of GST
GST on economy class air tickets 5%
GST on tickets of chartered flights for the purpose of pilgrimage 5%
GST on business class air tickets 12%
GST on chartered flights 18%

Note: The information mentioned above is indicative as GST rates are subject to change periodically.

GST on road transport

Particulars Rate of GST
GST on passengers travelling by road on public transport 0%
GST on passengers travelling by rickshaw/metered taxi/e-rickshaw 0%
GST on transport by non-A/C contract vehicle 0%
GST on transport by A/C contract vehicle 5%
GST on passenger travel by radio taxi 5%
GST on rental services of road vehicles (cars/buses) 18%

Note: The information mentioned above is indicative as GST rates are subject to change periodically.

GST on rail transport

Particulars Applicable GST
GST on AC and first class train tickets 5%
GST on the sleeper and general class 5%
GST on metro tickets 12%

Note: The information mentioned above is indicative as GST rates are subject to change periodically.

Also read: Advantages and Disadvantages of GST system

Frequently asked questions

What is the GST rate on household goods transportation?

Transportation of household goods for personal use does not attract any GST.

Are consignment notes and e-way bills the same document?

No. The consignment notes and e-way bills are two different documents serving separate purposes. A consignment note indicates that the logistics company or a trucking company has received goods for transportation purposes. On the other hand, an e-way bill is for avoiding tax evasion and also helps in tracking and monitoring the movement of goods.

Is e-Invoice compulsory for transportation?

Yes, e-invoicing is mandatory for the transportation.

Swati Deshpande


Author: Swati Deshpande

Swati is a passionate content writer with more than 10 years of experience crafting content for the business and manufacturing sectors, and helping MSMEs (Micro, Small and Medium Enterprises) navigate complexities in steel procurement, and business services. Her clear and informative writing empowers MSMEs to make informed decisions and thrive in the competitive landscape.