0% GST Goods | No Goods and Services Tax items (2024)

FAQs

What are zero rated goods under GST? ›

According to section 16 of the Integrated Goods and Services Tax (IGST) Act, 2017, zero rated supply means any of the following supplies of goods or services or both: Export of goods or services or both; or. Supply of goods or services or both to a special Economic zone (SEZ) developer or an SEZ unit.

Supplies which don't come under the scope of the GST are termed as Non-GST supplies. However, these supplies can attract taxes other than the GST as per the jurisdiction of the state or the country. Some examples of such supplies include petrol, alcohol, etc.

The main GST-free items are exports, health, food, education, international travel and certain charitable activities. A small range of items are "input taxed".

Zero-rated goods are products that are exempt from value-added taxation (VAT). Countries designate products as zero-rated because they are leading contributors to other manufactured goods and a significant component of a broader supply chain.

This means that although GST is applied, the rate is 0%, making the transaction tax-free. In summary, the key difference lies in how GST is applied: 'No GST' transactions are completely exempt from GST. 'Zero-rated GST' transactions have GST applied at a 0% rate, making them non-taxable.

For a “zero-rated good,” the government doesn't tax its sale but allows credits for the value-added tax paid on inputs. If a good or business is “exempt,” the government doesn't tax the sale of the good, but producers cannot claim a credit for the VAT they pay on inputs to produce it.

A nonexempt trust is a trust with an inclusion ratio greater than zero (typically, trusts that are either partly or fully subject to the GST tax).

Non-zero-rated supply means other than export of goods or services or both and other than supplies made to SEZ unit or SEZ Developer. In simple words, supplies made for home consumption (taxable and exempted both). It is pertinent to mention that zero rated supply is not exempted. Zero rate is also a rate of duty.

Certain basic food stuffs meant for human consumption are zero-rated in South Africa. This means while producers and retailers can claim VAT input credits, there is no VAT charged to consumers on these items. Basic food items exempt from VAT include: Brown bread.

On the 18/06/2010 the detailed food list for GST was updated so plant based milk products are treated the same as cows milk. They are all GST free. If the milk is flavoured, it becomes taxable. If you are ever unsure you can use our GST food classification decision tool.

Is interest GST free? ›

Interest Income: Interest income does not attract GST because it is an input taxed sale. A tax invoice that includes a mixture of GST free and GST-inclusive items.

example: Say you are selling a commodity from Mumbai and sending it to Kolkata for Rs. 10,000, and the rate of GST applied on it is 12%. The GST amount applicable for it will be (10,000 x 12) / 100 = Rs. 1,200; and the net price will be Rs. 10,000 + Rs. 1,200 = Rs. 11,200.

Final Notes. To summarise, zero-rated supply is a type of GST supply where the GST rate applicable is 0%, but the supplier can still claim the input tax credit. Nil-rated supply is a type of GST supply where the GST rate is also 0%, but the supplier cannot claim the input tax credit.

Zero-rated supply refers to the supply of goods or services that are either exported or supplied to SEZs and are not subject to GST in India. The main objective behind zero-rating supplies is to promote exports and SEZs, which play a vital role in the Indian economy.

"Sometimes people get confused between when to use GST-free (0%) and when to use the Out of Scope code. The distinction between the two codes is that transactions which are coded GST-free (0%) are reported on your Business Activity Statement, whereas transactions coded Out of Scope are not.

“Under Section 2 of the CGST Act, 2017 “capital goods” are defined as goods value of which is capitalized in the books of account of the person claiming ITC and are used in the course or furtherance of business.