“The latest GST rate on packers and movers ranges from 5% to 18% depending on the service you hire from the company. Transportation of goods where the packers and movers charge less than Rs. 1500 is exempt from GST. ”
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GST on Transportation and Supporting Services Offered by Packers and Movers
Are you looking for GST on packers and movers in India? Do you want to know the GST on transportation charges for household goods? Well, your search ends now. I am super excited to talk about the latest changes in GST rates for packers and movers and transportation services.
The Goods and Services Tax (GST) was implemented on July 1, 2017. Under this new system, goods and services have been classified into five tax slabs – 0%, 5%, 12%, 18%, and 28%. The basic GST slab is 18%. Please note that GST rates are subject to change and depend on the types of products and services.
Packers and Movers services are classified as a type of transportation service. This specific service falls under the category of “Transport of Goods by Road”, under GST. Initially, the applicable GST rate for such services was 5%. But this has changed now.
You must be curious to know which GST slabs the packers and movers are in. Again, it is unclear to many people.
Some people say it is 5%, some say it is 12%, and some say it is 18%. What is the actual GST rate on packers and movers services? Don’t be impatient. Keep your composure. I’ll let you know everything that you should know about GST rates on transportation services for household goods. In this blog post, I will share everything that you need to know. I have explored various authentic sources and prepared a complete guide to GST on transportation and packers and movers. Don’t be impatient. Keep your composure. I will discuss everything you need to know about GST on transportation services.
Misconceptions About GST Rates in Moving Industry
The contribution of the transportation industry to the development of a country is vital. The Indian transportation industry has had a large influence on India’s economic development. The progress of a country may slow or stop due to any problem in the transportation system. It is because disruptions in transport systems can disrupt the entire business channel.
Have you ever noticed what happens when transportation costs increase? People complain about inflation—a rise in the cost of everything. The new GST regime also has an impact on the transportation industry.
What are the rates levied on transport and logistics companies?
How much GST do packers and movers companies levy?
I am indirectly associated with the transportation industry. I found a number of customers’ complaints on Quora.com and other online forums about the tax rates of professional packers and movers under the new GST regime. Most customers are complaining that they are being forced to pay higher GST charges. They complain that the GST rate for transportation services comes under the slab of 5% or 12%, but relocation companies often charge 18%. In fact, there is a huge misunderstanding about the new GST regime in every industry, and the transportation industry is no exception. So, what is the truth? What is the actual GST rate that professional packers and movers or logistics companies should charge? Let’s understand it.
GST on Transportation – Packers and Movers GST Rates
There are different slabs for GST on transportation services. The latest GST rate slabs on movers and packers services in India are as follows:
|Packers and Movers Services||(CGST) Central GST||SGST (State GST) Rate||IGST (Integrated GST) Rate|
|Transportation of goods, wherein only transport service is availed.||2.5%||2.5%||5% without ITC (input tax credit)|
|Transportation of goods, wherein only transport service is availed.||6%||6%||12% with ITC (input tax credit)|
|Comprehensive goods transport services include packing, loading, transportation, unloading, and unpacking.||9%||9%||18%|
What is the Correct GST Rate for the Moving industry—5%, 12%, or 18%?
Logically, the GST on packers and movers comes under the 18% GST slab. Let’s understand. Professional packers and movers companies are not only logistics or transport companies; they also provide full services for shifting various types of items from one place to another.
Take the example of household goods shifting. If you hire household shifting services from one of the professional movers and packers in your city, they will provide you with not only transport services but also several supporting services. Major services include packing services, loading services, transportation services, unloading services, unpacking services, and rearranging services.
You see that you get total support throughout the whole episode of your move. You don’t need to lift even a single item with you. There are experts who will do everything for your move. Thus, you get the full services of professional packers and movers. And it will hereby attract a GST rate of 18%.
So, why are people complaining in various online forums that the real GST rate for packers and movers is 5% or 12%?
In some ways, they are not completely wrong. There is also a provision for a 5% or 12% GST rate in the transportation industry. A 5% or 12% GST rate is applicable when customers solely use the transport services of the logistics or packers and movers company. So, you must not agree with paying 18% GST if you are using only the transport of a logistic company; it’s only 5% without ITC (input tax credit) and 12% with ITC (input tax credit).
If your packers and movers show your house relocation goods as “cargo movement”, then you don’t need to pay 18% GST. Remember, cargo handling GST charges are only 5%.
In simple words, GST rates on packers and movers services in India are as follows:
- If a customer uses movers and packers exclusively for transport, the GST rate is 5%, or 12%.
- When a customer selects a comprehensive moving service that includes packing, appliance disassembly, loading and unloading, transportation, and insurance, the GST rate is 18%.
- If a customer purchases transportation services that also include transit insurance, the GST rate will be 18%.
- GST rate on transit insurance is also 18%.
Transportation of Goods Exempt Under GST
Transportation of goods from one place to another can be exempt if you are transporting goods without using the services of professional packers and movers or a courier agency. If you are transporting goods by inland waterways, then again, you are exempt from GST. Transportation of goods where the packers and movers charge less than Rs. 1500 is exempt from GST. Keep in mind that GST is applicable if you are using registered packers and movers or logistics companies for the transportation of goods.
The 18% GST is applicable when you use the full services of professional packers and movers. The 5% GST is applicable when using only the transport services of a logistics company or packers and movers.
One more important thing you should keep in mind. Don’t forget to check the GST registration of the moving company, if you are paying extra GST charges. You must ensure that you only select one of the GST registered packers and movers with a valid GSTIN number. By hiring a registered company, you can avoid possible scams. You can hire GST registered, IBA approved packers and movers through Movingsolutions.in