GTA Goods transport agency
Transportation plays a vital role in the supply chain, and under GST, the tax treatment of transport services depends on the type of service and input tax credit (ITC) eligibility. Below is a simplified explanation of the major categories:
Key Insight:
If you opt for a lower GST rate (5%), ITC claims are generally restricted.
If you charge 12% or 18%, full ITC is available.
Businesses should evaluate whether taking ITC benefits outweighs the reduced tax rate.
1. Goods Transport Agency (GTA)
HSN/SAC 9965
Covers supply of transport of goods by road through a Goods Transport Agency.
GST rate applicable: 12% to 18%, depending on ITC availability.—
2. Pipeline & Vehicle Transport
HSN/SAC 9965
Supply of transportation of petroleum crude, motor spirit, diesel, natural gas, or ATF through pipelines.
HSN/SAC 9966
Renting of motor vehicles (with operator) designed for carrying passengers, where fuel cost is part of the consideration.
GST Rate: 12% to 18%
3. Multimodal Transportation
HSN/SAC 9965
Refers to the movement of goods using more than one mode of transport (road, rail, air, or sea) under a single contract.
GST Rate:
12% to 18% with ITC (standard).
5% with restricted ITC (only input services in the same line of business all
4. Rail Transport of Goods
HSN/SAC 9965
Transport of goods in containers by rail (other than Indian Railways).
GST Rate: 12% to 18% with ITC.
5% without ITC.
5. Renting of Goods Carriage
HSN/SAC 9966
Renting of goods carriage (with operator) where fuel cost is included.
GST Rate:
12% to 18% with ITC.
5% with restricted ITC.–
6. Ancillary Services
HSN/SAC 9971
Third-party insurance services for goods carriage (with ITC).
GST Rate: 12% to 5% depending on ITC claim
This structured explanation helps taxpayers, logistics companies, and businesses clearly understand GST applicability on transportation services and make informed decisions.