Latest GST Rates in India: Sector-Wise Breakdown

The Goods and Services Tax (GST) is one of India’s most significant tax reforms, introduced to unify various indirect taxes under a single umbrella. Since its implementation, GST has been continuously updated to match the dynamic needs of the economy. Understanding the current GST rates across different sectors is essential for businesses, consumers, and tax professionals alike.

This article provides a detailed sector-wise breakdown of the latest GST rates in India as applicable in 2025.

1. Healthcare and Pharmaceuticals

• Life-Saving Drugs: Attract a reduced GST rate of 5% to ensure affordability.
  
• Generic Medicines: Typically taxed at 5% or 12%, depending on classification.
  
• Medical Equipment: Standard rate is 12%, including items like stents and implants.
  
• Health Insurance Premiums: Subject to 18% GST.

2. Automobiles and Electric Vehicles (EVs)

• New Electric Vehicles (EVs): Attract a 5% GST rate to promote clean mobility.
  
• Used EVs: Now taxed at 18% when sold by registered dealers.
  
• Petrol and Diesel Cars: Small cars generally taxed at 18%, while luxury and SUVs attract 28% + cess.
  
• Auto Parts and Accessories: Typically fall under the 28% GST bracket.

3. Real Estate and Construction

• Affordable Housing Projects: GST rate is 5%, without input tax credit.
  
• Under-Construction Properties: Subject to 12% GST if ITC is claimed; otherwise 5%.
  
• Commercial Properties: Generally taxed at 12%.
  
• Construction Materials:
  • Cement: 28%
    
  • Steel: 18%
    
  • Paints and Tiles: 18%

4. Food and Agricultural Products

• Unprocessed and Unpackaged Food: Exempt from GST (0%).
  
• Packaged and Branded Food Items: Taxed at 5%.
  
• Frozen and Processed Foods: Attract either 12% or 18% depending on the product.
  
• Agricultural Tools and Equipment: Mostly taxed at 12%.
  

5. Education and Training

• Educational Institutions (K-12): Exempt from GST.
  
• Coaching Centres and Online Courses: Subject to 18% GST.
  
• Skill Development Services: Exempt if offered under government-approved programs.

6. Hospitality and Tourism

• Hotel Room Tariffs:
  • Up to ₹1,000/night: Exempt
    
  • ₹1,001 to ₹7,500/night: 12%
    
  • Above ₹7,500/night: 18%

• Restaurants:
  • Non-AC/Standalone: 5% without ITC
    
  • AC or Part of Hotel: 18% with ITC
    
• Tour Operator Services: Taxed at 5% with restrictions on ITC.

7. Retail and Consumer Goods

• Essential Items (Salt, Sugar, Tea, etc.): Mostly 5%.
  
• Personal Care Products (Shampoo, Toothpaste): Generally taxed at 18%.
  
• Luxury Items (Perfumes, Deodorants): Attract 28% GST.
  
• Clothing and Footwear:
  • Under ₹1,000: 5%
    
  • Above ₹1,000: 12% or more depending on category.

8. Industrial and Manufacturing Sector

• Capital Goods and Machinery: Typically taxed at 18%.
  
• Raw Materials (Plastics, Metals, etc.): Also fall under the 18% bracket.
  
• Industrial Chemicals: Vary between 12% and 18%.
  

9. IT and Telecommunications

• Software Development Services: Taxed at 18%.
  
• Mobile Phones: Tax rate is 12%.
  
• Telecom Services (Prepaid/Postpaid): Subject to 18% GST.
  
• Laptops and Accessories: Usually taxed at 18%.

10. Transport and Logistics

• Railway Tickets:
  • Sleeper class: 5%
    
  • AC class: 5%

• Goods Transport Agency (GTA):
  • Without ITC: 5%
    
  • With ITC: 12%

• Air Travel:
  • Economy Class: 5%
    
  • Business Class: 12%

11. Banking and Financial Services

• Financial Services (Loans, Credit Cards, etc.): Taxed at 18%.
  
• Insurance Services: Also fall under 18% GST.
  
• Mutual Fund Services: Attract 18% GST on management fees.

12. Entertainment and Media

• Movie Tickets:
  • Below ₹100: 12%
    
  • Above ₹100: 18%

• Subscription-Based OTT Platforms: 18%
  
• Amusement Parks, Casinos, and Events: Taxed at 28%.

13. Textiles and Apparel

• Fabrics: Most types are taxed at 5%.
  
• Garments:
  • Below ₹1,000: 5%
    
  • Above ₹1,000: 12%

• Handlooms and Khadi: Often exempt or taxed minimally to promote traditional industries.

14. Household and Utility Products

• Cleaning Products (Detergents, Disinfectants): Taxed at 18%.
  
• Cookware and Utensils: Generally fall under the 12% bracket.
  
• Electronic Appliances:
  • Refrigerators, ACs, TVs >32 inches: 28%
    
  • Washing Machines, Fans: 18%
    

GST Rate Summary Table by Sector

Conclusion

India’s GST system is a dynamic and evolving structure aimed at simplifying tax compliance and enhancing revenue collection. Understanding the latest sector-wise GST rates helps businesses optimize pricing, maintain compliance, and improve transparency for consumers.

Staying updated with GST changes ensures better financial planning and smoother business operations. Always consult a tax professional for tailored advice, especially if you operate in multiple sectors or export/import goods and services.