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Key Highlights
- Raw silk, silk waste, and silk yarn are eligible for a lower GST rate of 5% to promote silk farming and traditional weaving sectors.
- Processed textiles, including woven silk fabrics, are charged 12% GST as they are finished and dyed.
- Embroidered silk fabrics and luxury textiles are charged 18% GST, increasing the cost of high-value textile products.
- Correct HSN code classification allows for proper GST application, enabling businesses to claim input tax credit (ITC) as due.
The textile sector is among the largest contributors to the Indian economy, with a very wide range of products, including fibres, fabrics, yarns, and garments. Textiles and textile articles come under Chapter 50 to Chapter 63 of the HSN Code system under the goods and services tax (GST) regime, with Chapter 50 being exclusively for silk and silk products.GST rates on textiles differ according to material, processing, and product categories, from 5% to 18%. Textile businesses need to be aware of the appropriate HSN classification and corresponding GST rates to be compliant and avoid the wrong filing of taxes. Also Read - Know how GST works in India
GST Rates on Textiles and Textile Articles (Chapter 50)
Textile articles falling under Chapter 50 are categorised according to their raw material content and production process. The following GST rates are applicable for them:
| HSN Code | Description | Rate (%) |
| 5001 | Reeling-suitable silk-worm cocoons | Nil |
| 50010000 | Reeling-suitable silk-worm cocoons | Nil |
| 5002 | Silk in raw (not thrown) | Nil |
| 500200 | Silk in raw (not thrown) | Nil |
| 50020010 | Silk in raw (not thrown) silk in raw (not thrown) mulberry silk in raw | Nil |
| 50020020 | Silk in raw (not thrown) silk in raw (not thrown) silk mulberry dupion | Nil |
| 50020030 | Silk in raw (not thrown) silk in raw (not thrown) silk without mulberry | Nil |
| 5003 | Silk waste (including garnetted stock, yarn waste, and cocoons unfit for reeling) | Nil |
| 500300 | Silk waste (including garnetted stock, yarn waste, and cocoons unfit for reeling) | Nil |
| 50030010 | Silk waste from mulberry | Nil |
| 50030020 | Silk waste from tussar | Nil |
| 50030030 | Dri waste | Nil |
| 50030040 | Munga waste | Nil |
| 50030090 | Other silk waste | Nil |
| 50031010 | Silk waste not carded or combed mulberry, includinggarnettedstock, yarn waste, and cocoons unfit for reeling silk waste | Nil |
| 50031020 | Tussar waste not carded or combined silk waste (including cocoons unfit for reeling, yarn waste, and garnetted stock) | Nil |
| 50031090 | Silk wastethat isnot carded ormanufacturedfurther elsewhere,inclusiveofgarnetted stock, yarn waste, andunfitcocoonsfor reeling | Nil |
| 50039010 | Mulberry silk waste (garnetted stock, yarn waste, andunfitcocoonsfor reelinginclusive) | Nil |
| 50039020 | Tussar waste silk waste (garnettedstock, yarn waste, andunfitcocoons for reeling inclusive) | Nil |
| 50039030 | Eri waste, silk waste (garnetted stock, yarn waste, andunfitcocoonsfor reelinginclusive) | Nil |
| 50039040 | Munga waste, yarn waste, garnetted stock, and silk waste (including cocoons unfit for reeling) | Nil |
| 50039090 | Garnetted stock, yarn waste, and silk waste (including cocoons unfit for reeling) – other | Nil |
| 5004 | Exceptforyarn spun from silk waste, including silk yarn which is not sold in retail. | 5% |
| 500400 | Exceptforyarn spun from silk waste, including silk yarn which is not sold in retail. | 5% |
| 50040010 | (Apart from silk waste-spun yarn) Nil mulberry dupion silk yarn notfor retail sale | 5% |
| 50040090 | Other than yarn spunonsilk waste. Notfor retail sale is silk yarn (exceptyarn spunonsilk waste): Other | 5% |
| 5005 | Notsuitable for retail sale: Yarn spun on silk waste | 5% |
| 500500 | Notsuitable for retail sale: Yarn spun on silk waste | 5% |
| 50050011 | Notsuitablefor retail sale: yarn spun from silk waste - including 85% or moreby weightof silk waste:exceptnoil silk | 5% |
| 50050012 | Notsuitablefor retail sale: yarn spun from silk waste - including 85% or moreby weightof silk waste: from silk and noil | 5% |
| 50050021 | Notsuitablefor retail sale: yarn spun from silk waste - including 85% or moreby weightof silk waste: from silk and noil | 5% |
| 50050022 | Notsuitablefor retail sale: yarn spun from silk waste - including 85% or moreby weightof silk waste: from silk and noil | 5% |
| 5006 | Silkworm gut, silk yarn, and yarn spun from silk waste,retailsale | 5% |
| 500600 | Silkworm gut, silk yarn, and yarn spun from silk waste,retailsale | 5% |
| 50060011 | Retailsale ofyarnspun from silk wasteand silk yarn; silk-worm gut silkworm gut: silk yarn and yarn spun from silk waste,retailsalesilk embroidery thread: silk yarn | 5% |
| 50060019 | Retail sale of silk yarn and yarn spun from silk waste; silk-worm gut silkworm gut: silk yarn and yarn spun from silk waste,retailsales- silk yarn: Other | 5% |
| 50060021 | Silkworm gut: Silk yarn and yarn spun on silk waste for retail sale - Spun yarnofsilk wastecontainingat least 85%by weightof silk: silk embroidery | 5% |
| 50060029 | Silkworm gut: silk yarn and yarn spun from silk waste,forretailsaleyarn spun from silk wastewith85% or more silk by weight: other | 5% |
| 50060031 | Silkworm gut: silk yarn and yarn spun from silk waste,forretailsaleyarn spun from silk wastewith85% or more silk by weight: spun from silk waste | 5% |
| 50060032 | Silkworm gut: silk yarn and yarn spun from silk waste,forretailsaleyarn spun from silk wastewith85% or more silk by weight: yarn spun from noil | 5% |
| 50060033 | Silkworm gut: silk yarn and yarn spun from silk waste,forretailsaleyarn spun from silk wastewith85% or more silk by weight: silk embroidery | 5% |
| 50060039 | Silkworm gut: silk yarn and yarn spun from silk waste,forretailsaleyarn spun from silk wastewith85% or more silk by weight: other | 5% |
| 50060090 | Silkworm gut: silk yarn and yarn spun from silk waste,forretailsaleyarn spun from silk wastewith85% or more silk by weight: other | 5% |
| 5007 | Silk woventextilesor silk waste | 5% |
| 50071000 | Fabricsof silk or silk wasteof noil silk | 5% |
| 500720 |
Otherfabricscontainingsilkor silk wasteat least 85% other than oil silk | 5% |
| 50072010 | Woollen fabricsof silk or silk wastecontainingat least 85% of silk or silk waste other than oil silk by weight: sarees | 5% |
| 50072090 | Woolentextilesof silk orwastesilkcontainingnotlessthan85%by weightof silk or silk wasteexcludingoil silk: Other | 5% |
| 500790 | Other | 5% |
| 50079010 | Additional handloom fabrics | 5% |
| 50079090 | Woven silk or silk waste fabrics other fabrics | 5% |
| 504004 | Excludingnatural food castings, guts | Nil |
| 504005 | Stomachs and bladders | Nil |
| 505902 | Excluding stuffing, other feathers | Nil |
| 505903 | Powder and feather waste or feather parts | Nil |
| 505909 | Skins andotheraspects | Nil |
| 506101 | Bones were crushed,suchashorn cores | Nil |
| 506102 | Grist bone | Nil |
| 506103 | Ossein | Nil |
| 506104 | Not crushed bones, horn cones, and partsthereof | Nil |
| 506901 | Meal of bone | Nil |
| 506909 | Other | Nil |
Saree HSN code
The saree HSN codevarieswiththetype offabricusedformaking them.Followingare theHSN codes and GST ratesapplicableforvarioustypes of sarees:
| HSN Code | Fabric Type | GST Rate |
| 5208, 5209 | Cotton Sarees | 5% (if below ₹1,000 per piece), 12% (if above ₹1,000 per piece) |
| 5007 | Silk Sarees | 5% (natural silk), 12% (artificial silk) |
| 5407, 5408 | Synthetic (Polyester, Nylon) Sarees | 5% (below ₹1,000), 12% (above ₹1,000) |
| 5111, 5112 | Woolen Sarees | 12% |
| 5810 | Embroidered or Designer Sarees | 12% or 18% (depending on material and embellishments) |
Also Read - Find out which goods and services are exempted from GST
How does HSN Chapter 50 impact Saree HSN Code?
HSN Chapter 50 exclusively addresses silk and silk-based products, such as raw silk, silk yarn, and woven silk fabrics. As sarees produced from pure silk are products of silk fabrics, HSN Code 5007 (woven fabrics of silk or silk waste) directly impacts the HSN classification of silk sarees. The impact of HSN 50 on Saree HSN Code is shown below: Silk Sarees Come Under HSN 5007 Pure silk sarees fall under HSN Code 5007 and are subject to 5% GST if they are less than ₹1,000 per piece and 12% GST if they are more than ₹1,000 per piece. This category includes sarees that are made of natural silk, such as Banarasi silk, Kanchipuram silk, and Tussar silk sarees. Artificial Silk Sarees Are Taxed Differently If a saree is produced from artificial silk (viscose, polyester-blended silk, etc.), it comes under HSN Code 5408 or 5407 and is charged at 5% GST (if less than ₹1,000) or 12% GST (if more than ₹1,000). This differentiation provides different taxes to natural silk sarees compared to synthetic silk sarees. Effect on Blended Silk Sarees Sarees with both silk and some other fibre content (such as cotton or polyester blends) are categorised according to whatever material they contain the majority of. Where there is high silk content, they may even fall under HSN 5007; otherwise, they may come under HSN 5208 (cotton-based) or HSN 5408 (synthetic blends). Impact on Embroidered or Designer Silk Sarees If silk sarees are heavily embroidered and contain zari work or embellishments, they may qualify for HSN 5810 and incur 12% or 18% GST, based on the extent of decoration.
Filing GST Returns for Textile Business Effectively
Comprehension of cloth HSN code and GSTrate on textiles and textile articles is significant for companies operating in the textile manufacturing, trading, and retail sectors.Silk and products made of silk are classified in Chapter 50 according to the stage of processing, with raw silk, silk waste, and silk yarn facing a reduced rate of GST of 5% to promote traditional weaving and sericulture industries. Processed fabrics, like woven silk and blended synthetics, are taxed at 12%, while luxury textile goods like embroidered silk cloth and home furnishings come under the 18% GST category.As different textile items come under different tax categories, accurate classification under the relevant HSN code is a must for compliance, correct tax payment, and availing of input tax credit (ITC). You can also use the GST calculator to find the applicable GST and file your returns correctly.By being updated on GST news and HSN categories, companies can maximise their tax design, minimise compliance threats, and run smooth operations in the fast-paced textile market. To remain updated, companies may check the official GST website or consult experienced tax advisors.
FAQS - FREQUENTLY ASKED QUESTIONS
What is the HSN code for raw silk?
Raw silk comes under HSN Code 5002 and is charged 5% GST. This covers silk extracted from cocoons directly without processing.
What is the GST on silk waste and silk yarn?
The GST rates on silk waste and silk yarn are:
Silk waste (HSN 5003) is charged with 5% GST
Silk yarn (not for sale in retail) comes under HSN 5004 and is charged at 5%
Silk yarn intended for retail sale (HSN 5005) also attracts 5% GST.
Are handloom silk fabrics exempt from GST?
No, handloom silk fabrics are not exempt but are liable to 5% GST, making them affordable for artisans and encouraging traditional weaving.
What is the GST rate on woven silk fabrics?
Woven silk fabrics belong to HSN Code 5007. Plain woven silk fabrics are subject to 12% GST, and luxury or embroidered silk fabrics are subject to 18% GST.
Is GST levied on synthetic silk and blended fabrics?
Yes, silk synthetic and blended fabrics (including silk-polyester blends) are classified under HSN Codes 5407 & 5408 and are levied 12% GST.
Are textile-based home furnishings of silk charging the same rate as fabric?
No, silk-based home furnishings like curtains, bed sheets, and tablecloths are classified under HSN Code 6303 and are charged 18% GST, as they are luxury items.
What GST rate is charged on textile carpets and floor coverings?
Carpets and floor coverings made of textiles are classified under HSN Code 5701 to 5705 and charged 18% GST, being finished goods.
Do businesses get an input tax credit (ITC) on GST paid for textiles?
Yes, ITC on GST paid for textiles can be availed by registered businesses if the textiles are being used for business purposes like resale, manufacturing, or processing.
Do imported silk fabrics and garments draw extra GST?
Yes, imported silk fabrics and garments draw customs duty along with GST based on their classification. The GST rates applicable are 5%, 12%, or 18%, based on the type of product.
How can enterprises check the right HSN code and GST rate for textiles?
Companies can verify the codes from the official GST portal and seek the advice of a tax expert for the most recent information on cloth HSN codes and GST rates for textile items.
The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.
