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The Finance Ministry has notified new HSN (Harmonised System of Nomenclature) for number of various food and non-food items under Goods & Services Tax (GST) law. These will be applicable from January 1.
There is no change in GST rate but only in HSN.
Experts say businesses are required to notice these changes and use them in issuance of e-way bill, e- invoicing etc. HSN is the identity of commodity being traded in global market. Same identity is used for domestic taxation to avoid any mismatch. Considering changes in international level, government amended certain provision related with custom duty for new HSN through the Finance Act. Now, new notification under GST law has incorporated these changes for GST too.
Aditya Singhania, Founder at Singhania’s GST Consultancy & Co, says HS Codes under the First Schedule of the Customs Tariff Act, 1975 are applicable even while doing classification for the purpose of GST. In this regard, it is very important to refer the Tariff Notification of goods issued under GST law wherein the rates of GST have been notified as specified from Schedule I to VI which duly mentions the Chapter / Heading / Sub-heading / Tariff item along with the description of goods.
“Trade and industries, in order to do compliance with the necessary provisions of the law w.e.f. January 1, 2022 needs to ascertain the impact areas due to change in HS Codes in their product lines, for instance in their invoicing system, e-waybill, e-invoicing, furnishing details of HSN while filing statements/returns, etc,” he said.
Some of the goods which will see fish, dried, salted or in brine; smoked fish, whether or not cooked before or during the smoking process; flours, meals and pellets, of fish fit for human consumption. Changes also cover cabbages, cauliflowers, kohlrabi, kale and similar edible brassicas, fresh or chilled and other nuts, fresh or dried, whether or not shelled or peeled beside olive oil and its fractions, whether or not refined, but not chemically modified including virgin olive oil.
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