HSN Code for Rice, Pulses, Oil & Spices – Exempted and Taxable Goods

Are you a small grocery store owner confused about the GST on packaged dal versus loose dal? Or a consumer wondering why some brands of rice have GST and others don’t? You’re not alone. This confusion often boils down to a single, crucial element in India’s tax system: the HSN code. Understanding the correct HSN code for rice, pulses, and other daily staples is essential for correct invoicing and GST compliance. HSN, or the Harmonized System of Nomenclature, is a universal classification system used to identify goods for GST purposes. For any business owner, knowing the right code isn’t just about paperwork; it’s about applying the correct tax rate and avoiding costly penalties. This comprehensive guide will demystify the HSN codes for rice, pulses, cooking oil, and common spices, clarifying exactly which goods are taxed and which are exempt.

What is an HSN Code and Why Does It Matter for GST?

Before diving into specific products, it’s vital to understand what an HSN code is and its role in the GST framework. This system is the backbone of goods classification, not just in India but globally, ensuring that trade and taxation are handled uniformly. For a detailed overview, see our HSN & SAC Code Complete Guide – Choosing the Correct Code for GST.

Understanding the HSN Framework

The Harmonized System of Nomenclature (HSN) is an internationally recognized method of classifying goods. It assigns a unique code to every product, making it easier for tax authorities to identify and apply the correct tax rate. In India, the HSN code is an 8-digit structure, although businesses may be required to use a 4 or 6-digit code depending on their turnover. This framework plays a critical role in the GST regime by:

• Ensuring Uniformity: It standardizes the classification of goods, leaving no room for ambiguity in tax assessment.
• Simplifying Trade: Both domestic and international trade becomes more streamlined as goods are identified by a universal code.
• Automating GST Returns: HSN codes are a mandatory part of GST returns, allowing for automated processing and reducing errors. To learn more, check our guide on How to File GST Returns Online: A Step-by-Step Guide of the GST Filing Process & Procedure.

HSN Code Requirements for Businesses in India

The requirement to mention HSN codes on tax invoices is directly linked to a business’s annual turnover. The rules are designed to ease the compliance burden on smaller businesses while ensuring detailed reporting from larger ones.

• Businesses with an annual aggregate turnover up to ₹5 crore: These businesses are required to use a 4-digit HSN code for all B2B (Business to Business) tax invoices. While it’s optional for B2C (Business to Consumer) invoices, it is a good practice to use them.
• Businesses with an annual aggregate turnover above ₹5 crore: These businesses must use a more detailed 6-digit HSN code on all their invoices, for both B2B and B2C transactions.

Mentioning the correct HSN code is a legal requirement. It ensures transparency for the buyer, helps them claim Input Tax Credit (ITC) correctly, and keeps your business compliant with GST laws. For a complete understanding of ITC, you can read our GST Input Tax Credit (ITC) Full Guide 2025 – Eligibility, Limits & Common Issues.

The Definitive Guide to the HSN Code for Rice

Rice is a staple food in India, and its GST treatment is a common point of confusion. The key differentiator for taxability isn’t the type of rice but its packaging. The entire category falls under HSN Chapter 1006, but the GST rate changes based on how it’s sold.

Exempted Rice (0% GST): HSN Code 1006

The core condition for rice to be exempt from GST is that it must not be pre-packaged and labelled. This means rice sold loose, directly from a gunny bag or container, does not attract any GST. This is one of the most common HSN codes for tax exemption in India.

• What it means: If a customer buys rice from your store and you weigh it from a large sack and put it into a plain plastic bag, it is exempt from GST.
• Examples: Loose Basmati rice, non-branded Sona Masuri sold from a large bin, or any rice sold in un-branded gunny bags to wholesalers or retailers.
• Keyword Focus: The HSN code for rice that is exempt falls under chapter 1006, but the key is its packaging. This exemption is designed to keep the cost of basic, unbranded staples low for the end consumer.

Taxable Rice (5% GST): HSN Code 1006

Rice becomes taxable at a rate of 5% GST the moment it is “pre-packaged and labelled.” This rule, defined under the Legal Metrology Act, 2009, applies when the product is packed in a predetermined quantity and bears a label with legally required declarations.

• What it means: Any brand of rice that is sold in a sealed bag of a specific weight (e.g., 1 kg, 5 kg, 10 kg) with the brand name and other details printed on it will attract a 5% GST. This applies even if the brand is not a registered trademark.
• Examples: A 5kg sealed bag of India Gate Basmati Rice, a 10kg packet of a local brand’s Kolam rice, or any rice sold in a branded, sealed container.
• Keyword Focus: Therefore, while the Indian HSN code for rice and pulses might share a similar classification principle, the tax liability changes based on packaging. This is a crucial detail when categorizing taxable goods HSN code India for your inventory.

HSN Codes for Pulses, Edible Oils, and Spices

Like rice, other essential kitchen items have specific HSN codes and tax rules that every grocer and consumer should be aware of.

HSN Code for Pulses (Dal, Chana, Rajma)

The GST treatment for pulses mirrors that of rice. The classification falls under HSN Chapter 0713. The distinction between taxable and exempt is again based on the packaging.

• Exempt (0% GST): Pulses such as dal, chana, rajma, and others sold loose from sacks or containers are exempt from GST.
• Taxable (5% GST): When these same pulses are pre-packaged and sold in labelled bags (e.g., a 1kg packet of Tata Sampann Toor Dal), they attract a 5% GST.
• Keyword Focus: Similar to rice, the HSN code for pulses is governed by the packaging rule. Unbranded dals sold loose are exempt, while branded, sealed packets attract 5% GST.

HSN Code for Oil (Edible Oils)

Unlike rice and pulses, the tax treatment for edible oils is more straightforward. Most common cooking oils are taxed, regardless of whether they are branded or unbranded, packaged or sold loose. They fall under HSN Chapter 15.

• Tax Rate: Edible oils attract a standard 5% GST.
• Examples: Mustard oil (HSN 1514), sunflower oil (HSN 1512), groundnut oil (HSN 1508), and coconut oil (HSN 1513) are all taxed at this rate.
• Keyword Focus: Finding the HSN code for oil is relatively simple as most common edible oils used in Indian households are taxed at a standard rate of 5%.

HSN Code for Spices

Spices, a vital part of Indian cuisine, are classified under HSN Chapter 09. Most common spices, whether sold whole or in powdered form, are subject to GST.

• Tax Rate: Spices generally attract a 5% GST. This applies to pre-packaged branded spices as well as those sold loose.
• Examples with specific codes:
  • Turmeric (Haldi): HSN 0910 30
  • Coriander (Dhania): HSN 0909 21
  • Chillies (Mirch): HSN 0904 21
  • Cumin (Jeera): HSN 0909 31
• Keyword Focus: The HSN code for spices is specific to each item, but most of them fall under a 5% GST slab, making tax calculation consistent across the category.

A Practical Guide: How to Check HSN Code in India

Ensuring you are using the correct HSN code is non-negotiable for GST compliance. Fortunately, there are reliable ways to find and verify this information.

Method 1: Using the Official GST Portal

The most authoritative source for HSN codes is the official GST website maintained by the Government of India. It has a user-friendly search tool.

Here is a step-by-step guide:
1. Visit the official GST website: www.gst.gov.in.
2. Navigate to the top menu and click on Services > User Services.
3. From the dropdown list, select Search HSN Code.
4. You can search either by the HSN code/chapter itself or by the description of the goods (e.g., “rice,” “turmeric”). The tool will provide the relevant code and description.

Actionable Tip: Always cross-verify your HSN codes on the Official GST Portal to ensure accuracy before raising an invoice or filing your returns.

Method 2: Consulting a GST Expert

For businesses with a large and diverse inventory, manually searching for each code can be tedious and prone to error. Misclassifying a product can lead to incorrect tax payments, interest, and penalties. In such cases, seeking professional help is the safest and most efficient option.

Call-to-Action (CTA): If you’re unsure how to check HSN code in India for your specific products or want to ensure your entire inventory is correctly classified, TaxRobo’s GST experts can provide precise classification and ensure your business remains compliant. Our team can help you navigate the complexities and avoid any potential legal issues.

Conclusion

Understanding HSN codes is a fundamental aspect of running a compliant business in India. The rules, though seemingly complex, are logical. For essential staples, the key takeaway is that the taxability of goods like rice and pulses hinges on whether they are pre-packaged and labelled. Items sold loose are generally exempt, while packaged and branded versions attract a 5% GST. Most other daily-use items like edible oils and spices are consistently taxed at 5%. Getting the HSN code for rice and other essentials right is fundamental to avoiding tax-related issues, ensuring smooth ITC claims for your customers, and maintaining healthy business operations.

Don’t let GST compliance slow you down. From GST registration and filing to expert advisory on complex classification issues, TaxRobo is here to help. Contact us today for a hassle-free tax experience!

Frequently Asked Questions (FAQs)

1. Is GST applicable on all types of rice in India?

Answer: No. GST at 5% is only applicable on rice that is pre-packaged and labelled, meaning it is sold in a sealed container of a predetermined quantity with a brand name or other details. Rice sold loose or un-branded from a gunny bag or container is completely exempt from GST.

2. What happens if I use the wrong HSN code on my invoice?

Answer: Using an incorrect HSN code can lead to several problems. It can result in an incorrect tax calculation (either overpayment or underpayment), which may attract interest and penalties from the tax department. Furthermore, it can cause issues for your B2B customers when they try to claim Input Tax Credit (ITC), as the details on your invoice will not match their records.

3. How do I find the correct HSN code for a new product I am selling?

Answer: The best and most reliable method is to use the ‘Search HSN Code’ tool available on the official GST portal (gst.gov.in). You can search by product description to find the relevant chapter and code. For complex products or if you are ever in doubt, it is highly recommended to consult a tax professional like those at TaxRobo. This is the surest way to answer how to check HSN code in India.

4. Are exempted goods HSN code India always the same?

Answer: While many essential goods have been kept exempt to protect consumers from price hikes, the list of exempted goods is not permanent. The GST Council can amend the GST laws and rates based on economic factors. It is crucial for businesses to stay updated with the latest notifications from the CBIC (Central Board of Indirect Taxes and Customs) or work with a tax consultant like TaxRobo to ensure ongoing compliance.

5. What is the main difference between exempted and nil-rated goods?

Answer: This is a common point of confusion. Exempt goods are not taxable under GST at all. Businesses that deal exclusively in exempt goods are not required to register for GST. Nil-rated goods, on the other hand, are technically taxable under GST, but the tax rate is set at 0%. Businesses dealing in nil-rated goods must follow all GST compliance procedures, including obtaining GST registration (if turnover exceeds the threshold) and filing regular GST returns.