India stands as the second-largest producer of Cement in the world. The country has vast areas of quality limestone deposits and is equipped with raw materials, and the cement industry possesses excellent growth potential. The World Customs Organization developed HSN or the Harmonized System of Nomenclature. It is used to classify goods, and its classifications are accepted globally.
Did you know? India has used the HSN codes since 1986 to separate Customs and Central Excise goods.
How Does HSN Code Work In India?
India has been a member of the World Customs Organization since 1971. To classify goods for customs and central excise, it started using the 6 – digit HSN codes in 1986. Two more digits were added later to the HSN code by Customs and central excise.
After introducing GST (Goods and Service Tax) in India, HSN has been used under a 3-tiered system and includes the following:
- Businesses with a turnover of ₹ Rs 1. 5 crores or less need not use the HSN
- Businesses with a turnover of more than ₹ 1. 5 crores but less than ₹ five crores should use the 2 – digit HSN codes
- Businesses having a turnover of more than ₹ five crores must use 4 – digit HSN codes
- Businesses dealing with exports and imports need to use an 8 – digit HSN code
- HSN codes have 21 sections containing 99 chapters, 1,244 headings and 5,224 sub-headings.
- Each section number is further divided into chapters. These chapters are divided into headings and then subheadings.
- The sections and chapters describe the product
- The headings and sub-headings offer in-depth detail about the product
Also Read: E invoicing – Know What is E invoicing under GST, System, Benefits & More
GST Rates and HSN Code For Cement
The HSN code and the GST rate for Cement are mentioned below:
|
HSN Code |
Description of product |
CESS Percent |
Rate Percent |
Effective Date |
Rate Revision |
|
6810 |
Articles of cement, of concrete / of artificial stone, whether or not reinforced – tiles, bricks, flagstones and similar articles |
0 |
12 / 18 |
15/11/2017 1/07/2017 |
omitted from 28 percent 12 percent 18 percent |
|
681011 |
Building blocks and bricks |
0 |
12 / 18 |
15/11/2017 1/07/2017 |
omitted from 28 percent 12 percent 18 percent |
|
68101110 |
Articles of cement, of concrete or of artificial stone, whether or not reinforced – tiles, bricks, flagstones, and similar articles: building blocks and bricks: cement bricks |
0 |
12 / 18 |
15/11/2017 1/07/2017 |
omitted from 28 percent 12 percent 18 percent |
|
68101190 |
Articles of cement, of concrete or of artificial stone, whether or not reinforced – tiles, flagstones, bricks and similar articles: building blocks and bricks: other |
0 |
12 / 18 |
15/11/2017 1/07/2017 |
omitted from 28 percent 12 percent 18 percent |
|
681019 |
Other |
0 |
12 / 18 |
15/11/2017 1/07/2017 |
omitted from 28 percent 12 percent 18 percent |
|
68101910 |
Articles of cement, of concrete or of artificial stone, whether or not reinforced – tiles, flagstones, bricks and similar articles: other: cement tiles for mosaic |
0 |
12 / 18 |
15/11/2017 1/07/2017 |
omitted from 28 percent 12 percent 18 percent |
|
68101990 |
Articles of cement, of concrete or of artificial stone, whether or not reinforced – tiles, flagstones, bricks and similar articles: other: other |
0 |
12 / 18 |
15/11/2017 1/07/2017 |
omitted from 28 percent 12 percent 18 percent |
|
68109100 |
Articles of cement, of concrete or of artificial stone, whether or not reinforced other articles: prefabricated structural components for building or civil engineering |
0 |
12 / 18 |
15/11/2017 1/07/2017 |
omitted from 28 percent 12 percent 18 percent |
|
681099 |
Other |
0 |
12 / 18 |
15/11/2017 1/07/2017 |
omitted from 28 percent 12 percent 18 percent |
|
68109910 |
Articles of cement, of concrete or of artificial stone, whether or not reinforced other articles: other: concrete boulder |
0 |
12 / 18 |
15/11/2017 1/07/2017 |
omitted from 28 percent 12 percent 18 percent |
|
68109990 |
Articles of cement, of concrete or of artificial stone, whether or not reinforced other articles: other: other |
0 |
12 / 18 |
15/11/2017 1/07/2017 |
omitted from 28 percent 12 percent 18 percent |
All HSN Codes For Portland Cement With GST Rates
HSN code of cement is 2523, related aspects of the product are as follows in the provided table
|
Description of product |
HS Code |
GST Percentage |
|
White portland cement, whether or not artificially coloured |
252321 |
28 percent |
|
Portland cement (excluding white, whether or not artificially coloured) |
252329 |
28 percent |
|
Cement, whether or not coloured (excluding portland cement and aluminous cement) |
252390 |
28 percent |
|
Ordinary portland cement, dry products include: ultra tech cement, OPC cement |
25232910 |
28 percent |
|
Ordinary portland cement, coloured |
25232920 |
28 percent |
|
Portland pozzolana cement |
25232930 |
28 percent |
|
Portland slag cement |
25232940 |
28 percent |
|
Other portland cement nes |
25232990 |
28 percent |
Also Read: All you need to Know About GST Certification Course | Legaltree
Importance of HSN Code under GST
The main purpose of the HSN code is to make the GST process systematic and globally accepted. The HSN code eliminates the requirement of uploading a detailed description of a particular good/ product. This saves time and makes filing easier and hassle-free as GST returns are automated. A service provider must mention an HSN – wise summary of sales in the GSTR – 1 if the turnover is more than ₹ 1. 5 crores.
Classification Of Goods Under HSN
The Central excise and customs department has been using the HSN system in India since 1986. In India, two more digits were added to the 6 – digit code for better differentiation of the commodities. According to the classification of the code, the first two digits represent the chapter number of a product. The next two digits refer to the heading number. In comparison, the last two digits stand for the product code.
Requirement of HSN Code in GST
Across the world, HSN codes are globally accepted in more than 200 countries. This high usage is due to the benefits of HSN.
The benefits of HSN codes are mentioned below:
- HSN codes furnish a rational basis for Customs tariffs
- It allows the collection of relevant data on international trade statistics
- It is a globally accepted uniform classification.
HSN codes are available for each product in all member countries. These codes remain the same for all similar commodities. Although in some countries, the numbers may have variations.
Advantages of HSN Code in GST
The advantages of the HSN code are mentioned below:
- The code provides a uniform system of classifying goods for Customs and Central Excise globally
- It offers a uniform global taxation system
- It makes it easier to have international business dealings
- It is also used in filing returns
Also Read: Who Is an Input Service Distributor in GST? – Definition and Purpose
Conclusion:
The article highlighted the information about the cement HSN code. The HSN code in GST is very helpful for customs agents. It also has an important role in the process of tax collection. It is of great help in making the GST universal. The HSN code in GST has done away with uploading detailed descriptions for goods.
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