GST on Imported Goods in India: Customs and IGST
Whether you’re importing electronics, apparel, or business supplies, imported goods in India are subject to taxes under both Customs Duty and Goods and Services Tax (GST). If you’re a buyer or a business dealing with global trade, understanding gst on import goods helps you avoid surprises at the border.
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Is GST Applicable on Imports?
Yes. Under Indian tax law, imports are treated as inter-state supplies, and hence Integrated GST (IGST) is applicable in addition to customs duties.
So, when a product enters India from another country, it attracts:
- Basic Customs Duty (BCD)
- Social Welfare Surcharge (SWS)
- IGST (GST for imports)
- Compensation Cess (if applicable on luxury/sin goods)
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How is GST Calculated on Imports?
Here’s how the value for IGST is calculated:
IGST = (Assessable Value + BCD + SWS) × Applicable GST Rate
Example:
- Assessable value: ₹10,000
- BCD: 10% = ₹1,000
- SWS: 10% of BCD = ₹100
- IGST rate: 18%
IGST = (₹10,000 + ₹1,000 + ₹100) × 18% = ₹11,100 × 18% = ₹1,998
Total tax payable: ₹1,000 (BCD) + ₹100 (SWS) + ₹1,998 (IGST)
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GST for Imports: Applicable Rates
| Category of Goods | HSN Chapter | IGST Rate |
|---|---|---|
| Electronics (phones, TVs) | 85 | 18%–28% |
| Apparel/footwear | 61, 62, 64 | 12%–18% |
| Luxury goods (watches, perfumes) | Varies | 28% + Cess |
| Toys, books, stationery | 95, 49, 48 | 12%–18% |
| Food items and packaged goods | 20, 21, 22 | 5%–18% |
GST on Low Value Imported Goods
Even low value imported goods are not exempt from GST. Items shipped via courier or postal services (under ₹5,000) also attract IGST.
| Type of Item | Imported Value | GST on Low Value Goods |
|---|---|---|
| Apparel from international websites | < ₹5,000 | 12%–18% |
| Gadgets from foreign platforms | < ₹5,000 | 18% |
| Personal use items (non-commercial) | Varies | Yes, GST applicable |
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Can Importers Claim Input Tax Credit (ITC)?
Yes. Registered businesses importing goods can claim Input Tax Credit on IGST paid at customs, provided:
- The goods are used for business
- The importer has a valid GSTIN
- The bill of entry (customs document) is available
- The ITC is properly reported in GSTR-2B / GSTR-3B
However, BCD and SWS are not eligible for ITC.
Conclusion
Understanding the gst on import goods is key for pricing products, clearing customs, and maintaining accurate records—especially if you’re an eCommerce seller, global trader, or regular online shopper.
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 (FAQs)
- Is GST applicable on all imported goods?Yes. All imports attract IGST, in addition to customs duties.
- What is the GST for imports under ₹5,000?Even low-value goods attract GST based on the product category (typically 12%–18%).
- Can IGST on imports be claimed as ITC?Yes, if the goods are for business use and you are GST-registered.
- Do I have to pay both GST and customs duty?Yes. Imports attract Customs Duty + IGST, and sometimes Cess for specific goods.
- Is GST different for personal vs. commercial imports?The tax rates are the same, but ITC is available only for business/commercial imports.
