--- title: "New GST on AC 2026: 18% Rate on Air Conditioners & Cooling" description: "New GST rate on AC in 2026 is 18% on all split, window and portable air conditioner units. Get GST-ready with Busy and apply the correct rate on every invoice." canonical: "https://busy.in/gst-rates/ac/" author: "Apurva Maheshwari" published: "2025-04-22T05:34:29.000Z" category: "GST Rates" --- # New GST on Air Conditioners in India: Everything You Need to Know Air conditioners (ACs) are no longer just luxury appliances—they’re becoming a necessity in India’s scorching summers. But when buying an AC, have you considered how much tax you’re paying? This blog breaks down the GST (Goods and Services Tax) applicable on air conditioners, explains the [**HSN code**](https://busy.in/hsn/) , and highlights how it impacts your final purchase price. ## **New GST Rate on Air Conditioners in India** From **22 September 2025**, the GST rate on air conditioners was reduced from **28% to 18%**. The revised rate applies to air-conditioning machines falling under **HSN 8415**. | Product | GST Rate | | --- | --- | | Air conditioners, including split, window and inverter ACs | 18% | ## Alternatives with Lower Energy Use and Low New GST Rates If you’re looking for efficient cooling options, consider: | Product Type | New GST Rate | | --- | --- | | Ceiling fans | 18% | | Air coolers | 18% | | Inverter-based ACs | 18% (lower power use vs conventional) | Although ACs are now at **18%**, inverter-based models reduce energy bills and long-term operating cost. ## Old GST Rate on Air Conditioners Under GST, air conditioners fall under the **highest tax slab of 28%**. This rate categorizes ACs as “luxury or sin goods,” placing them in the same bracket as items like cars and high-end electronics. | Product | GST Rate | | --- | --- | | Air Conditioner (all types: split, window, inverter) | 28% | This rate is uniform across both residential and commercial buyers. Live Demo Available Today ## Keep AC Invoices And GST Reports Ready With BUSY. Trusted by 6,00,000+ Users 4.6 Google Rating \* No credit card required ## HSN Code for Air Conditioners The **HSN (Harmonized System of Nomenclature)** code for air conditioners is 8415. This includes machines and appliances for treating air (whether or not they include a means for humidity control or temperature control). | Product Type | HSN Code | Description | | --- | --- | --- | | Air Conditioners | 8415 | Self-contained or split-system AC units | Retailers and manufacturers must use this HSN code when [**invoicing under GST**](https://busy.in/gst/a-guide-to-invoicing-under-gst/) . ## **GST Calculation Example** Let’s assume you’re buying a split AC for ₹35,000 (base price). - **Base Price:** ₹35,000 - **GST @18%:** ₹6,300 - **Total Invoice Value:** ₹35,000 + ₹6,300 = ₹41,300 So, your ₹35,000 AC costs **₹41,300 after GST is applied**. ## **GST on Air Conditioners Reduced to 18%** Air conditioners previously attracted **28% GST**. From **22 September 2025**, the GST rate on air conditioners has been reduced to **18%**. - **Previous GST rate:** 28% - **Current GST rate:** 18% - **Effective from:** 22 September 2025 Live Demo Available Today ## Track Stock, Bill Fast, Keep GST Ready With BUSY. Trusted by 6,00,000+ Users 4.6 Google Rating \* No credit card required ## Input Tax Credit (ITC) on ACs ##### For Businesses: If you’re a business buying ACs for commercial use (e.g., offices, stores, hotels), you [**can claim ITC**](https://busy.in/gst/who-can-claim-itc-in-india/) on the GST paid. Conditions to claim ITC: - You are a GST-registered business - The AC is used for business operations - You have a proper tax invoice ##### For Individuals: Home users **cannot claim ITC**, as personal consumption doesn’t qualify under [**GST rules**](https://busy.in/gst/rules-for-input-service-distributor-under-gst-laws/) . ## **Impact on Consumers** The reduction in GST on air conditioners from **28% to 18%** lowers the tax burden on consumers and reduces the overall purchase cost of ACs. For example, on an AC with a base price of ₹35,000, GST is now **₹6,300 instead of ₹9,800**, resulting in a tax saving of **₹3,500**. ## **Cooling Alternatives and GST Rates** If you’re looking for other cooling options, consider: | Product Type | GST Rate | | --- | --- | | Ceiling fans | 18% | | Air coolers | 18% | | Inverter-based ACs | 18% | Air conditioners, including inverter-based models, are now taxed at **18% GST**. ## Unique Features of BUSY Accounting Software For the Air Conditioner Industry - Track AC models by brand, tonnage, star rating, and features with detailed inventory management. - Manage each AC unit using serial numbers for warranty and service tracking. - Create job cards for installations, servicing, and repairs with technician assignments. - Configure seasonal discounts, brand schemes, and bundled offers with ease. - Define customer-specific pricing and dealer-wise margins or incentives. - Access actionable reports like model-wise sales. ## Final Thoughts While air conditioners offer comfort, the 28% GST adds a significant amount to the final price. Understanding how GST works on appliances like ACs can help you make better financial decisions—whether you’re a homeowner or a business. And if you’re running a commercial space, don’t forget to [**claim your input credit!**](https://busy.in/gst/what-expenses-can-be-claimed-as-itc/) ## About the author **Apurva Maheshwari** I am a Chartered Accountant with 5 years of experience specializing in GST, income tax, and HSN code classification. I help businesses with GST compliance, tax planning, and financial advisory, ensuring they meet regulatory requirements while optimizing their tax strategies. I aim to simplify GST filings, income tax laws, and HSN code classifications, helping professionals and business owners stay informed and compliant. ## Frequently asked questions ### What is the GST rate on split and window air conditioners? Both split and window air conditioners attract **18% GST**, regardless of their model or capacity. ### Can I claim GST input credit on AC purchases? Yes, but only if you are a GST-registered business and the AC is used for business purposes. ### Why is the GST rate on ACs so high? Air conditioners are considered luxury items under the GST regime, hence placed in the highest tax bracket. ### Is there any difference in GST rate between energy-efficient and normal ACs? No. Both energy-efficient and regular air conditioners attract **18% GST**. ### Does GST include installation charges? If installation charges are part of the invoice, GST is applicable on the total bill amount. If charged separately, they may attract a different rate (typically 18%). ## Related articles - [New GST on Skincare Products: Rate, Branding & Retail Pricing](https://busy.in/gst-rates/skincare-products/) - [New GST on Industrial Machinery: Slabs, ITC & MSME Effect](https://busy.in/gst-rates/industrial-machinery/) - [New GST on Restaurant Meals: Dine-in, Takeaway & Delivery Compared](https://busy.in/gst-rates/restaurant-meals/) - [New GST on Kitchen Utensils: What’s Taxed and What’s Not?](https://busy.in/gst-rates/kitchen-utensils/) - [New GST on Online Education: Rate, Exemptions & EdTech Impact](https://busy.in/gst-rates/online-education/) - [New GST on Packaging Materials: Tax Implication Across Industries](https://busy.in/gst-rates/packaging-materials/) - [New GST on Digital Marketing Services: Tax Rates & Input Credit Explained](https://busy.in/gst-rates/digital-marketing-services/) - [New GST on Pesticides: Rates, Agri-Exemptions & Sector Impact](https://busy.in/gst-rates/pesticides/) - [New GST on Butter: From Dairy to Dining – What You Pay](https://busy.in/gst-rates/butter/) - [GST on Honey: Rate, Applicability & Industry Outlook](https://busy.in/gst-rates/honey/)