Keeping up with GST notifications can feel like a full-time job. With the latest amendments in the 2025-2026 fiscal year, the government has shuffled the tax slabs for several key items.
Whether you are a trader updating your billing software or a consumer checking prices, you need accurate HSN codes to stay compliant. General terms like “snacks” or “seats” aren’t enough—you need the specific 4 to 8-digit HSN codes to know if you should charge 5%, 12%, 18%, or 28%.
Below is the complete comparison table of the major items that have seen rate changes recently.
The Master List: Old vs. New GST Rates
Here is the snapshot of the most significant changes affecting businesses today.
| Item Description | HSN Code | Old Rate | New Rate |
| Health Insurance (Individual/Family) | 9971 | 18% | Nil (0%) |
| Cancer Drugs (Trastuzumab Deruxtecan, Osimertinib, Durvalumab) | 3004 | 12% | 5% |
| Extruded/Expanded Savoury Snacks (e.g., Bhujia, salted snacks) | 1905 90 30 | 12% | 5% |
| Car Seats (Seats for Motor Vehicles) | 9401 | 18% | 28% |
| Metal Scrap (Iron, Steel, Copper, Aluminum)* | 7204, 7404, 7602 | 18% | 18% (RCM Applies) |
| Paper Waste/Scrap | 4707 | 12% | 5% |
| Roof Mounted AC Package Units (for Railways) | 8415 | 18% | 28% |
| Helicopter Charter (Seat-share basis) | 9964 | 18% | 5% |
Note on Metal Scrap: While the rate remains 18%, the liability has shifted. If you buy from an unregistered dealer, you (the registered buyer) must pay this tax under Reverse Charge Mechanism (RCM).
Detailed Breakdown of Key Changes
1. Savoury Snacks (HSN 1905)
Previously, there was confusion between “unbranded” snacks (5%) and “branded/packaged” snacks (12%). The council has simplified this for specific categories.
- Change: Extruded or expanded products (like cheese balls, puffed snacks) falling under HSN 1905 90 30 have been reduced to 5%.
- Impact: This helps local manufacturers compete with bigger brands and lowers the MRP for the end consumer.
2. Cancer Drugs (HSN 3004)
The government has targeted three specific life-saving drugs for a rate cut.
- Drugs: Trastuzumab Deruxtecan, Osimertinib, and Durvalumab.
- Change: Reduced from 12% to 5%.
- Why: To reduce the financial burden on patients undergoing expensive oncology treatments.
3. Car Seats (HSN 9401)
- Change: Tax increased from 18% to 28%.
- Logic: Seats for motorcycles were already at 28%. The council observed that car seats are similar automotive components and should not enjoy a lower rate. If you are in the auto-accessories business, ensure your billing software is updated immediately to avoid short-payment penalties.
4. Metal Scrap (HSN 7204 / 7404 / 7602)
This is a compliance change rather than just a rate change.
- Old Rule: Seller collects tax (Forward Charge).
- New Rule: If the supplier is unregistered, the registered buyer pays the tax (Reverse Charge).
- Action: Buyers must now create self-invoices for these purchases and pay the 18% tax in cash (which can later be claimed as ITC).
Conclusion
Correct HSN coding is the backbone of GST compliance. Using an old rate like 12% for Namkeen when it has dropped to 5% makes you uncompetitive. Conversely, charging 18% for Car Seats when the law demands 28% invites a tax notice.
Action Item: Review your inventory master today. Filter by the HSN codes listed above and update the tax rates in your ERP or accounting software (like Tally/Zoho) to ensure your next invoice is 100% accurate.
Frequently Asked Questions (FAQs)
What is the HSN code for the new 5% GST rate on Namkeen? A: The specific HSN code for extruded or expanded savoury products (salted) that has been reduced to 5% is 1905 90 30. Standard unbranded namkeen also falls under 2106 90 at 5%.
Has the HSN code for Health Insurance changed with the 0% rate? A: No, the SAC code (Service Accounting Code) remains 9971. However, the rate associated with this code for individual policies is now Notification-exempt (Nil rated), while group policies remain taxable at 18%.
Do I need to pay RCM on all scrap purchases? A: RCM applies specifically when a registered person buys metal scrap (HSN 7204, 7404, etc.) from an unregistered supplier. If you buy from a registered dealer, they will charge GST on the invoice as usual (Forward Charge).
What is the new GST rate for Paper Scrap under HSN 4707? A: The GST rate for waste and scrap of paper or paperboard (HSN 4707) has been reduced from 12% to 5% to encourage recycling industries.
Are all cancer medicines now at 5% GST? A: No. Only the three specific drugs notified (Trastuzumab Deruxtecan, Osimertinib, and Durvalumab) are reduced to 5%. Other medicines generally remain at 12% or 18% depending on their specific HSN classification.
