MENTIONING
OF HSN CODES IN INVOICES IN GST REGIME
The Goods and Services Tax
Act, 2017 came into force in India from 1.7.2017 onwards.
In the earlier acts, the
commodity codes and schedules may differ state to state and rate of tax differ
from state to state. The rate of tax for the same commodity may vary as
exempt, 1%, 2%, 5%, 14.5% etc. state to state. In the GST Act, instead of
Commodity code HSN Codes were prescribed and the suppliers of goods has to
mention the HSN Codes in their invoices in order to avoid misclassification of
goods. The rate of tax fixed under the GST for goods using the HSN Codes will
be the same all over India without any deviation as decided by the GST Council.
Due to the introduction of HSN Code mismatch in commodity will not
arise if correct HSN code applied for supplies between supplier and recipient.
Mentioning HSN Codes by
small taxpayers were very difficult and hence the Government of India has
issued Notification stating that a registered person having annual turnover in
the preceding financial year shall mention the digits of HSN Codes in the tax
invoice as shown below:
TABLE
Sl.No.
|
Annaul
Turnover in the preceeding Financial Year
|
Number
of Digits of HSN Code
|
(1)
|
(2)
|
(3)
|
1.
|
Upto rupees one crore fifty lakhs
|
NIL
|
2.
|
More than rupees one crore fifty lakhs and upto
rupees five crores
|
2
|
3.
|
More than rupees five crores
|
4
|
Please click the link below to view the Notification:
central-tax-english.pdf
http://www.cbec.gov.in/resources//htdocs-cbec/gst/notfctn-5-igst-tax-english.pdf
http://www.cbec.gov.in/resources//htdocs-cbec/gst/notfctn-5-igst-tax-english.pdf