GST on Clothes: Applicability, Rate and HSN Code

The Indian textile industry is pivotal to the country's economic development, significantly contributing to employment, GDP and export promotion. As one of India's oldest industries, it ranks second only to agriculture in providing both skilled and unskilled employment. Since the introduction of the GST law, the GST rates on clothing have undergone several revisions due to the industry's complex tax structure.

GST rate for garments, accessories and clothing

Chapter 61 of the HSN code covers apparel and knitwear, while Chapter 62 addresses clothing and accessories that are not crocheted. For items in either category with a taxable value not exceeding Rs.1000 per piece, a 5% GST applies. According to Schedule II of Chapter 62, a 12% GST is levied on all clothing and accessories with a retail value exceeding Rs.1000.

GST on clothing and accessory items

Chapter 63 of the HSN code, titled "Other made-up textile articles, sets, worn clothing and worn textile articles; rags," encompasses a variety of textile products such as curtains, bed sheets, used clothing and other textiles. The GST rate for items in this chapter depends on the retail price: a 5% GST applies if the sale price is less than Rs.1000 and a 12% GST is levied if the sale price exceeds Rs.1000.

The GST Council has established GST rates for all commodities based on HSN codes, an international system for classifying goods in global trade. In accordance with the HSN classification, the GST rates for commodities like cotton, yarn, silk, wool and nylon vary widely, ranging from 0% to 5%, 12%, 18% and up to 28%. These products are categorized under different chapters of the HSN code.

GST rate for cotton

Cotton is categorized under Chapter 52 of the HSN code. Consequently, items made of cotton, such as Gandhi topi and khadi yarn, are exempt from GST. All other cotton and cotton-related products are subject to a 5% GST.

• Cotton
• Cotton waste
• Cotton-based thread used for sewing
• Cotton yarn, other than khadi yarn
• Cotton fabrics

GST rate for wool

Chapter 51 of the HSN code classifies wool, fine or coarse animal hair, horsehair yarn and woven cloth. Waste wool or fine or coarse animal hair, as well as coarse or fine animal hair that has not been carded or combed are exempt from GST.

The following items are subject to a 5% GST rate:

• Garnetted stock of wool or fine or coarse animal hair, shoddy wool
• Wool and fine or coarse animal hair, carded or combed
• Yarn of wool or animal hair
• Fabrics of wool or animal hair

GST rate for Nylon and artificial fibres

Nylon and other artificial fibres are classified under Chapter 54 of the HSN code, along with synthetic filaments and similar synthetic textile materials. Items in this chapter are taxed at either 5%, 12% or 18%. Textile fabrics made from man-made fibres are subject to a 5% GST.

GST rates for clothing and apparel

Items	HSN CODES	GST Rate	Conditions
Knitted clothing and accessories	61	5%	If the taxable value is less than ₹1000
Garments and accessories that are not knit or that were produced mechanically	62	5%	If the taxable value is less than ₹1000
Clothing and apparel irrespective of how they have been made	61 & 62	5%	If the taxable value is equal to or exceeds ₹1000
Other textile-based products (for example bed sheets and curtains)	63	5%	If the taxable value is equal to or exceeds ₹1000
	63	12%	If the taxable value is equal to or exceeds ₹1000

 

FAQ’s

Q1. What is the GST rate on clothes?
Ans. The GST rate on clothes varies depending on the type of garment. However, most clothes are taxed at 5% GST.

Q2. What is the GST rate for T-shirts?
Ans. T-shirts with a sale value not exceeding Rs. 1000 per piece attract a 5% GST, while those exceeding Rs. 1000 per piece attract a 12% GST.

Q3. What is the HSN code and GST rate for garments?
Ans. The HSN code and GST rate of a garment depends on its price and specifications.

Q4. What is the new GST rate on readymade garments?
Ans. Readymade garments of sale value not exceeding Rs.1000 per piece attract 5% GST, while those exceeding Rs.1000 per piece attract 12% GST.

Q5. What is the HSN code and GST rate for labour charges?
Ans.

Particulars	HSN Code	GST Rate
9988	Job work in relation to Textiles and textile products falling under Chapter 50 to 63 in the First Schedule to the Customs Tariff Act, 1975 (51of 1975)	5 %
9988	Services by way of job work other than above	12%

Q6. What is the HSN code for Tailoring services?
Ans. The HSN code for tailoring services is 9988 and the GST rate is 5%.

Q7. What is the GST rate & HSN Code on sarees?
Ans. Sarees are taxed at a GST rate of 5% under HSN code 5208 to 5212.

Q8. What is the HSN code for unstitched suits or dress material?
Ans. The HSN code for dress material is 5208 to 5212, and the GST rate is 5%.

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