GST Rates and HSN Code for Cut Flowers and Flower Buds – 603

The relevance of flowers is not limited to their appeal and feelings as they also contribute significantly towards areas like retail and horticulture. In India, the tax structure pertaining to Goods and Services (GST) covers flowers and buds that have been cut. This article looks deeper into the flower HSN code 603, the applicable flower GST rate, and the intricacies of GST on flowers to give a more in-depth review to businesses and consumers.

What is the HSN Code for Flowers and Flower Buds?

The Harmonized System Nomenclature (HSN) code is an internationally accepted method for describing goods in a systematic way. The HSN code for cut flowers and buds is “603”. This code covers products made principally for ornamental purposes like for bouquets or other decorations. This code also includes buds HSN code to ensure there is a common classification and taxation of cut flowers and flower buds.

GST Rates for Cut Flowers and Flower Buds

The rate of GST differs with respect to if the flowers are fresh, dried, dyed or even buds. Below is a detailed table summarizing the flowers GST Rates relative to their form and usage:

HSN Code	Description	Rate (%)
603	Cut Flowers And Flower Buds Of A Kind Suitable For Bouquets Or For Ornamental Purposes, Fresh, Dried, Dyed, Bleached, Impregnated Or Otherwise Prepared - Fresh:	Nil
6031000	Cut Flowers And Flower Buds Of A Kind Suitable For Bouquets Or For Ornamental Purposes, Fresh, Dried, Dyed, Bleached, Impregnated Or Otherwise Prepared Fresh	Nil
6031100	Cut Flowers And Flower Buds Of A Kind Suitable For Bouquets Or For Ornamental Purposes, Fresh, Dried, Dyed, Bleached, Impregnated Or Otherwise Prepared -Fresh: -- Roses	Nil
6031200	Cut Flowers And Flower Buds Of A Kind Suitable For Bouquets Or For Ornamental Purposes, Fresh, Dried, Dyed, Bleached, Impregnated Or Otherwise Prepared -Fresh: -- Carnations	Nil
6031300	Cut Flowers And Flower Buds Of A Kind Suitable For Bouquets Or For Ornamental Purposes, Fresh, Dried, Dyed, Bleached, Impregnated Or Otherwise Prepared -Fresh: -- Chrysanthemums	Nil
6031400	Cut Flowers And Flower Buds Of A Kind Suitable For Bouquets Or For Ornamental Purposes, Fresh, Dried, Dyed, Bleached, Impregnated Or Otherwise Prepared -Fresh: -- Chrysanthemums	Nil
6031900	Cut Flowers And Flower Buds Of A Kind Suitable For Bouquets Or For Ornamental Purposes, Fresh, Dried, Dyed, Bleached, Impregnated Or Otherwise Prepared -Fresh: -- Other	Nil
6039000	Cut Flowers And Flower Buds Of A Kind Suitable For Bouquets Or For Ornamental Purposes, Fresh, Dried, Dyed, Bleached, Impregnated Or Otherwise Prepared Other	Nil

Also Read: Plants & Parts of Plants HSN Code & GST Rate

GST Exemption for Fresh Flowers

In India, fresh flowers and flower buds are exempt from the Goods and Services Tax (GST) when they are used for bouquets and other decorative purposes. This relieves panic among people involved in the floriculture business, enabling them to price their products competitively. It is also helpful to private individuals who purchase flowers for weddings and festivals or other events.

GST on Processed Flowers

However, flowers which are dried or dyed for crafting and decorative purposes are subject to a tax rate of 18 percent. Processed flowers are more valuable because they undergo some value addition, which makes them fall under the taxable bracket.

Some of the rules which businesses involving processed flowers should follow include:

1. A business which deals with processed flowers and has a turnover larger than the threshold amount should apply for registration under GST.

2. Tax invoices with the appropriate rate of flower GST should be provided.

3. GST returns should be filed on time for compliance purposes.

Impact of GST on the Floriculture Industry

GST’s introduction has greatly simplified the previous indirect taxation system in India, making it simpler and thus more effective. Here is an assessment of how GST on flowers impacts different groups of stakeholders:

For Farmers

1. Most importantly, farmers selling fresh flowers do not pay GST and thus do not incur any extra tax burden.

2. This encourages the expansion of the floriculture industry since it ensures that the cost of fresh flowers will remain affordable.

For Wholesalers and Retailers:

1. For taxation, it depends on whether the flowers offered are fresh or processed.

2. Sellers of processed flowers are required to register for GST and file returns.

For Consumers:

1. Tax is not paid by buyers of fresh flowers.

2. The buyers of processed flowers have to incur additional costs because of the tax of 18%.

You Can Also Read: What are Agro based Industries? Types and Examples

Conclusion

Compliance and planning for a business in the flowers HSN code 603 and flower GST code is very crucial for the floriculture business. The objective of the GST is to provide support for farmers and the agricultural industry by exempting fresh flowers while ensuring adequate taxation of the value-added processed products. Understanding the GST regulations is important for businesses so that they do not get into legal issues and other challenges. Following these principles, stakeholders will be able to deal with tax issues prudently and at the same time advance the development of the Indian floriculture business.

FAQs

1. What is the HSN code for cut flowers and flower buds?

The HSN code for cut flowers and flower buds is 603 which covers fresh flowers, decorative buds and other processed floral items.

2. Is there a GST rate that applies to fresh flowers HSN code flowers?

Exemption from GST is granted for fresh flowers covered by the flower HSN code (603) to promote the floriculture industry.

3. Are dried flowers liable to tax under GST?

As per the flower GST rate, dried, dyed, or any altered flowers are taxable under GST at 18%.

4. What is the impact of GST on flowers for end users?

Processed flowers might be more expensive as it incurs the 18% flower GST rate while consumers are able to enjoy the benefit of the GST exemption on fresh flowers.

5. Which products are included in the buds HSN code?

The buds HSN code (603) captures flower buds ready for bouquets or decorative purposes, both fresh and processed.

6. Are GST taxes incurred on floral decorations made using fresh flowers?

Floral decorations are tax free using fresh flowers as its components under the flower GST rate structure.

7. Are floriculture enterprises required to register for GST?

It is true that floriculture businesses have to register for GST if their annual turnover exceeds a certain limit, even if it is fresh flowers.

8. Can ITC be claimed by businesses on flowers?

ITC is claimable for taxable items like processed flowers but cannot be claimed for fresh as there is no GST charged on it.

9. What is the reason for fresh flowers not incurring GST?

Fresh flowers are exempt from the hassle of GST so as to aid the agricultural and horticulture industry, making flowers cheaper and fostering growth in the industry.