In India, the transportation sector plays a vital role in the economy, and the Goods and Services Tax (GST) has a significant impact on this industry. Goods transport is not split between a "composition" and a "regular" rate. A goods transport agency (GTA) pays 5% under reverse charge — the recipient pays the tax and the GTA cannot take input tax credit — or, at its option, 18% on forward charge with ITC; that forward-charge rate was 12% until 22 September 2025. A transporter who is neither a GTA nor a courier agency supplies transport of goods by road at Nil. The composition scheme is a separate taxpayer-level scheme (section 10(2A), 6% up to ₹50 lakh) and not a rate option within goods transport. SAC 9965 covers goods transport services. SAC 9966 is rental services of transport vehicles — it is not transport of goods by air or water; goods moved by air or water fall under 9965. Courier services use SAC 9968.
The GST rate for transporter services is as follows:
| HSN/SAC Code | Service Description | GST Rate (%) | Effective Date |
|---|---|---|---|
| 9965 | Transport of goods by road (GTA) | 5 (reverse charge, no ITC to the GTA) / 18 (forward charge, with ITC) | 1st July 2017; forward-charge rate 18% from 22 September 2025 |
| 9966 | Rental services of transport vehicles (not transport of goods by air or water) | 5 (renting of goods carriage where fuel cost is included) / 18 (other rental of transport vehicles) | 22 September 2025 |
For example, if the base price of the transporter service is ₹100, the total GST amount would be:
For Composition Scheme: ₹100 x 5% = ₹5
For Regular Scheme: ₹100 x 18% = ₹18
To calculate the total GST amount, you can use our GST calculator widget:
5 (Composition Scheme) 18 (Regular Scheme) function calculateGst() { var basePrice = document.getElementById("base-price").value; var gstRate = document.getElementById("gst-rate").value; var gstAmount = basePrice * gstRate / 100; document.getElementById("gst-amount").innerHTML = "Total GST Amount: ₹" + gstAmount.toFixed(2); }The Composition Scheme is a simplified tax payment scheme for small businesses, with a turnover of up to ₹1.5 crore. Under this scheme, the taxpayer pays a fixed percentage of their turnover as tax, without input tax credit. The Regular Scheme, on the other hand, allows for input tax credit, but requires more complex compliance and record-keeping.
The key differences between the Composition Scheme and Regular Scheme are:
Before the introduction of GST, transporter services were taxed under the Service Tax regime, with a tax rate of 15%. The GST regime has replaced the Service Tax regime, with a tax rate of 18% for Regular Scheme and 5% for Composition Scheme.
The key differences between the Service Tax regime and GST regime are:
Q: Can I claim input tax credit on transporter services under the Composition Scheme?
A: No, input tax credit is not allowed under the Composition Scheme.
Q: What are the compliance requirements for transporter services under GST?
A: The compliance requirements include invoice-level reporting, input tax credit reconciliation, and payment of tax on a monthly or quarterly basis, depending on the turnover of the business.
Q: Can I use the GST calculator widget for other services, such as food delivery or courier services?
A: No, the GST calculator widget is specifically designed for transporter services, and may not be accurate for other services. Please consult the relevant GST rates and compliance requirements for other services.
To avoid common billing mistakes associated with transporter services, please ensure that:
By following these compliance tips and using our GST calculator widget, you can ensure accurate and compliant billing for your transporter services business.
5%
9965 and 9966
1st July 2017
18%
Significantly, as it affects the economy and compliance requirements
Rate position checked against the CBIC rate notifications (Notification No. 11/2017-Central Tax (Rate) and Notification No. 9/2025-Central Tax (Rate) as amended) and the GST Council's 56th meeting recommendations.
