GST Rates and HSN Code for Iron Ores and Concentrates: Everything You Need to Know

Iron ore is an essential commodity used in the manufacturing of iron and steel products. In India, iron ore is found in almost all states, with the major iron ore producing states being Odisha, Chhattisgarh, Karnataka, Goa, and Jharkhand. However, the mining and transportation of iron ore have been subject to a plethora of rules and regulations, including the determination of GST rates and HSN codes.

Understanding GST Rates for Iron Ores and Concentrates

Iron ore and its concentrates are classified under heading 2601 of the Harmonized System of Nomenclature (HSN) and attract a GST rate of 5%. The GST rate for iron ore fines, however, is 18%. The GST rate for iron ore pellets is also 5%. The GST rates for iron ore and its concentrates have been revised several times since the introduction of GST to streamline the tax structure and reduce the tax burden on the industry.

HSN Codes for Iron Ores and Concentrates

The HSN code for iron ore and concentrates is 2601. This HSN code is used to identify the type of product and determine the applicable GST rate. The HSN code for iron ore fines is 2601 12, while the HSN code for iron ore pellets is 2601 20. It is essential to use the correct HSN code for the product to avoid any confusion or dispute with the tax authorities.

Impact of GST on the Iron Ore Industry

The introduction of GST has had a significant impact on the iron ore industry. The reduction in the GST rates for iron ore and its concentrates has provided a much-needed relief to the industry, which was reeling under the burden of high taxes and levies. The simplified tax structure has also reduced the compliance burden on the industry and improved the ease of doing business.

Conclusion

The determination of GST rates and HSN codes for iron ore and its concentrates is essential to ensure a smooth and hassle-free tax compliance process. The industry can benefit from the simplified tax structure and reduced tax burden, which can boost the growth and development of the sector. Therefore, it is vital to stay updated on the latest changes in GST rates and HSN codes to avoid any legal disputes and ensure smooth tax compliance.