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    GST Rate Changes for Service Sector

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    Shubham Sinha

    September 4, 2025

    Services Sector

    S.No. HSN Code Description of Service From To
    1. 9954 (i) Composite supply of works contract services involving predominantly earth work (that is constituting more than 75 percent of the value of the works contract) provided to
    Government    		 12% with ITC 18% with ITC
    (ii) Composite supply of works contract provided by a sub- contractor to the main contractor providing services at (i) above
    to Government    		 12% with ITC 18% with ITC
    (iii) Composite supply of works contract and associated services, in respect of offshore works contract relating to oil and gas exploration and production in
    offshore area    		 12% with ITC 18% with ITC
    2. 9963 Supply of “hotel
    accommodation” having value of supply of a unit of accommodation less than or equal to seven thousand five hundred rupees per unit per day
    or equivalent    		 12% with ITC 5% without ITC
    3. 9964 (i) Supply of Air transport of
    passengers in other than economy class    		 12% with ITC 18% with ITC
    (ii) Supply of Passenger transport by any motor vehicle where fuel cost is included 5% with ITC of input services (in the same line of
    business)    		 5% with ITC of input services (in the same line of
    business)
    12% with ITC 18% with ITC
    4. 9965 (i) Supply of Transport of goods by GTA 5% without ITC
    (RCM/FCM)    		 5% without ITC
    (RCM/FCM)
    12% with ITC 18% with ITC
    (ii) Supply of transport of goods
    in containers by rail by any    		 12% with ITC 5% without ITC
    18% with ITC
        person other than Indian
    Railways    		    
    (iii) Supply of transportation of natural gas, petroleum crude, motor spirit, high speed diesel
    or ATF through pipeline    		 5% without ITC 5% without ITC
    12% with ITC 18% with ITC
    (iv) Supply of Multimodal transport of goods within India 12% with ITC 5%, where no leg of transport is through air, with restricted ITC (i.e. 5% of input services of goods
    transportation).
    18% with ITC
    5. 9966 (i) Supply of Renting of any motor vehicle (with operator) designed to carry passengers where the cost of fuel is included in consideration 5% with ITC of input services (in the same line of
    business)    		 5% with ITC of input services (in the same line of
    business)
    12% with ITC 18% with ITC
    (ii) Supply of Renting of goods carriage (with operator) where fuel cost is included in consideration 12% with ITC 5% with ITC of input services (in the same line of
    business)
    18% with ITC
    6. 9968 (i) Local delivery services
    (This service is currently taxed at the rate of 18% with ITC as this is covered under SAC 996813 – under the Group
    Postal and Courier Services)    		 18% with ITC 18% with ITC (no change)
    (ii)   Supply   of   local   delivery services     through     Electronic Commerce Operator (ECO) Not currently notified under section 9(5) of the CGST Act ·    Local delivery services to be notified under section 9(5)   of   the CGST Act in cases    where the      person
    supplying
            such services through electronic commerce operator      is not liable for registration under GST
    ·    The applicable rate  on  such services to be 18%.
    ·    Local delivery services provided   by and   through ECO   to   be excluded from         the
    scope         of GTA
    services.
    7. 9971 Supply of Service of third-party
    insurance of “goods carriage”    		 12% with ITC 5% with ITC
    8. 9973 Leasing or rental services, without operator, of goods which will attract (28%) 40%
    GST    		 28% With ITC 40% with ITC
    9. 9983 Other professional, technical and business services relating to exploration, mining or drilling of petroleum crude or natural
    gas or both;    		 12% with ITC 18% with ITC
    10. 9986 Support services to exploration, mining or drilling of petroleum
    crude or natural gas or both.    		 12% with ITC 18% with ITC
    11. 9988 (i) Supply of services by way of job work in relation to
    umbrella    		 12% with ITC 5% with ITC
    (ii) Supply of job work services
    or any treatment or process in    		 12% with ITC 5% with ITC
        relation to printing of all goods falling under Chapter 48 or 49,
    which attract GST @12% 5%    		    
    (iii) Supply of job work in
    relation to bricks which attract GST at the rate of 5%    		 12% with ITC 5% with ITC
    (iv) Supply of job-work services in relation goods falling under Chapter 30 in the First Schedule to the Customs Tariff Act, 1975 (51of 1975) (pharmaceutical
    products)    		 12% with ITC 5% with ITC
    (v) Supply of job-work services in relation to Hides, skins and leather falling under Chapter 41 in the First Schedule to the
    Customs Tariff Act, 1975    		 12% with ITC 5% with ITC
    (vi) Supply of job-work not
    elsewhere covered (residual entry)    		 12% with ITC 18% with ITC
    12. 9994 (i) Services by way of treatment
    of effluents by a Common Effluent Treatment Plant;    		 12% with ITC 5% with ITC
    (ii) Services by way of treatment or disposal of biomedical waste or the processes incidental thereto by a common bio- medical waste treatment facility
    to a clinical establishment.    		 12% with ITC 5% with ITC
    13. 9996 (i) Services by way of admission to exhibition of cinematograph films where price of admission ticket is one hundred rupees or
    less.    		 12% with ITC 5% with ITC
    (ii) Admission to casinos, race clubs, any place having casinos or race clubs, or sporting events
    like the IPL.    		 28% With ITC 40% with ITC
    (iii) Services by a race club for
    licensing of bookmakers in such club.    		 28% With ITC 40% with ITC
    14. 9997 Beauty and physical well-being services falling under group 99972
    [This service is currently taxed at the rate of 18% with ITC as this is covered under SAC 9997]    		 18% with ITC 5% without ITC
    15. Any chapter Specified Actionable Claims (betting, casinos, gambling, horse racing, lottery, online money gaming) defined as goods
    (Corresponding changes in the lottery valuation rules are also being carried out)    		 28% With ITC 40% with ITC

    A. Services Proposed to be exempted

    S.No. HSN Code Description of Service From To
    1 9971 (i) All individual health insurance, along with
    reinsurance thereof    		 18% with ITC Exemption
    (ii) All individual life
    insurance, along with reinsurance thereof    		 18% with ITC

    Exemption

     

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