GST Rates and 2302 HSN Code for Bran, Sharps, and Other Residues

The HSN plays an important role in the classification of goods internationally in treaties or agreements on tariffs and trade in regions. The “brans, sharps and other residues of milling industry” agricultural by-products businesses should know the details of HSN Code 2302. Not only that, but they should also be aware of the GST obligations that go along with it. Let us look at the other details regarding the sub-classification HSN Code 2302 and the GST rates that go with it. This information is relevant to all participants in the industry.

What is HSN Code 2302?

HSN code 2302 is related to:

Bran, sharps and other residues, whether or not in the form of pellets, are obtained through the sifting, milling or other working of cereals or leguminous plants.

This group includes by-products from the manufacturing processes of cereals and Legumes. These by-products are mostly utilised as animal fodder, fertilisers, and even food because of their available nutrition.

Sub-classifications Under HSN Code 2302

The 2302 classification is further divided based on the source material:

HSN Code	Derived From	Description
230210	Maise (Corn)	By-products from maise processing
23021010	Maise (Corn)	Maise bran
23021090	Maise (Corn)	Other by-products from maise processing
230220	Rice	By-products from rice processing
23022010	Rice	De-oiled rice bran
23022020	Rice	Raw rice bran
23022090	Rice	Other by-products from rice processing
23023000	Wheat	Wheat bran and other residues from wheat processing
23024000	Other Cereals	By-products from cereals other than maise and wheat
23025000	Leguminous Plants	Residues from the processing of legumes

GST Rates Applicable to HSN Code 2302

Knowing the GST rates for these products is important for pricing, compliance, and accounting purposes. Listed below are the GST rates of products falling under HSN Code 2302:

5% GST Rate: For the following goods:

Bran, sharps, and other leftover materials resulting from the sifting, milling, or other processing of cereals or legumes, whether in pelletised form or not.

By-products of extracted maise, rice, wheat, other cereals and legumes.

Now, keep in mind that some animal feed ingredients and some feedingstuffs are GST-free. But, the residues and by-products AND goods that fall under HSN 2302 ARE taxed at a 5% GST rate.

Practical Implications for Businesses

Attached to companies that engage in the making, distributing, or advertising of the goods are some challenges they practically encounter:

GST Classification: Concerning the specified GST rate, make sure that the product classification falls within the relevant HSN sub-code.

Invoicing: Compliance with legal requirements and the avoidance of disputes can be achieved by adding the right codes. Not every invoice is exempt from the HSN code and the corresponding suitable GST rate.

Input Tax Credit: All registered persons under GST law are eligible to avail of any ITC under the tax paid on inputs, barring some conditions. To utilize an ITC, proper documentation and compliance have to be satisfied.

Changes In Law: Laws and taxes are subject to change. As a consequence, sudden activity on official GST sites or contacting tax experts becomes necessary.

Conclusion

For anyone engaging with agricultural by-products like bran, sharps, or other residues, comprehending the intricacies of HSN Code 2302 along with its applicable GST implications is essential. From compliance to pricing to tax benefits, these factors will ensure that there are no issues with GST filing. Informed and proactive businesses can mitigate the burden of taxation by assuming tax liabilities well in advance, therefore ensuring a simplified and smooth tax collection process.

FAQs

1. What is HSN Code 2302?

HSN Code 2302 covers bran, sharps, and other residues produced during the sifting, milling, or other processes of legumes and cereals and whether such ingredients are transformed into pellets or not.

2. What is the GST rate applicable to products under HSN Code 2302?

Bran and other residues classified under HSN 2302 (such as bran and sharps) are charged a 5% GST rate. However, some feeds for animals might not be subjected to GST.

3. Is de-oiled rice bran taxable under GST?

Indeed, the GST for de-oiled rice bran is 5%, as it falls under the HSN Code 23022010.

4. Can businesses claim Input Tax Credit (ITC) on GST paid for products under HSN 2302?

Registered GST companies are entitled to an ITC claim only for taxes paid on purchases made if an individual or business abides by the requirements of the GST Act.