--- title: "New GST on Electricity 2026: 0% Rate on Electricity Bills & Power" description: "New GST rate on electricity in 2026 is 0% as electricity is fully exempt from GST in India. Busy helps you apply the right GST rate on every invoice." canonical: "https://busy.in/gst-rates/electricity/" author: "Jagdish Prasad" published: "2025-05-15T07:37:17.000Z" category: "GST Rates" --- - Electricity itself is not covered under GST, as it is considered a basic necessity. - Services related to electricity, like installation or maintenance, may be taxed at 18% GST. - Electronic items such as fans and inverters are subject to GST, generally at 18%. - Private electricity supply, like from generators, may attract 18% GST as a service. - Residential electricity bills are GST-exempt, but commercial users may pay GST on additional service charges. # New GST on Electricity: Is It Covered Under GST? Electricity powers our homes, businesses, and industries. But when it comes to taxes, many people are confused about whether electricity is taxed under GST. In this blog, we’ll break down what the law says about the [**gst on electricity**](https://busy.in/gst/) , how it applies, and where it doesn’t. The Government of India is updating GST rates effective after **22 Sep 2025**. Below are the **expected new GST rates** for common electronic items (no compensation cess). ## New GST on Electronic Items It’s important not to confuse electricity with electronic items. Products like fans, refrigerators, and inverters are subject to GST. | Product Type | New GST Rate | | --- | --- | | Household appliances (fans, mixer-grinders, refrigerators, etc.) | 18% | | Air conditioners (all types, incl. inverter) | 18% | | LED lights & luminaires (general lighting) | 5% | | Inverters & UPS systems | 18% | ## Is Electricity Covered Under GST? The short answer is: No, electricity supply is not covered under GST. - Electricity is classified as a basic necessity, and the government has kept it outside the GST regime. - No GST is charged on your electricity bill from your utility provider. - Electricity provided by government-authorized distribution companies is exempt from GST. **Get a Free Trial –** [**Best Accounting Software For Small Business**](https://busy.in/accounting-software/) Live Demo Available Today ## Issue Credit Notes for Electricity Billing Disputes in Seconds Trusted by 6,00,000+ Users 4.6 Google Rating \* No credit card required ## What About Electricity-Related Services? Even though electricity itself is exempt, services related to electricity may attract GST. Here’s how: - **Installation and Maintenance:** Electrical wiring, transformer setup, or repair work may be taxed at 18% GST. - **Electricity Connection Charges:** Utility companies may charge for new connections or upgrades — these may also attract GST. **Get a Free Trial –** [**Best GST Accounting Software For Small Business**](https://busy.in/accounting-software/gst-accounting/) ## Old GST on Electronic Items ### (Old GST Rates – Applicable Until 21st September) It’s important not to confuse electricity with electronic items. Products like fans, refrigerators, and inverters are subject to GST. | Product Type | Approximate GST Rate | | --- | --- | | Household Appliances | 18% | | Air Conditioners | 28% | | LED Lights | 12% | | Inverters & UPS systems | 18% | **Get a Free Demo of –** [**Electronics Goods Billing Software**](https://busy.in/accounting-software/electronics-goods/) ## What About the GST on Electricity Bills for Businesses? - Electricity bills from government-authorized providers remain exempt from GST. - Private supply, generator power, or DG set rentals may attract GST at applicable rates (usually 18%). So, while **gst on electricity bill** doesn’t apply for normal usage, [**Input Tax Credit**](https://busy.in/gst/input-tax-credit/) can still be claimed on related services if used for business purposes. **Get a Free Demo of –** [**Electrical Shop Accounting Software**](https://busy.in/accounting-software/electrical-shop/) ## Conclusion While electricity itself is not taxed under GST, services and products connected to it may be. Whether you’re a household consumer or a business, understanding this difference helps you manage costs and stay compliant. So, the next time you check your **gst on electricity bill**, remember — the main electricity charge is exempt, but it’s smart to watch for GST on any extra services or equipment. ## About the author **Jagdish Prasad** Jagdish Prasad is a Chartered Accountant with over 5 years of experience. He helps people and businesses with GST, income tax, and HSN codes. Jagdish makes sure his clients follow all tax rules and save money the right way. He also enjoys writing simple articles to help others understand taxes and stay updated with the latest rules. ## Frequently asked questions ### Is GST applied on domestic electricity bills? No, **residential electricity bills** are **GST-exempt**. ### Do commercial users pay GST on electricity? The **electricity supply itself is exempt**, but **additional service charges** (like meter rent or supervision fees) may attract GST. ### What is the electricity GST rate for industrial supply? There is **no GST on electricity supply** itself, regardless of the consumer. However, **associated services** may attract GST. ### Does GST for electricity apply to private power generation? Yes, **electricity supplied by private entities** (e.g., through gensets or solar PPAs) may attract **18% GST** as a service. ### Are electronic items related to electricity taxed? Yes. Items like **inverters, batteries, and cables** are taxed at standard rates, generally **12% or 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/)