Input Tax Credit (ITC) can be claimed only if opting for the 12% rate under GTA or the standard 18% slab. It is not claimable under the 5% rate for GTA services.

Transportation HSN Code 9965: GST Rate & Service Scope Explained

Q: What’s the standard GST rate?

Usually 5% or 18%, depending on the type of operation. Exemptions and specific conditions may apply.

Q: Which services are tax-exempt?

Transportation services for agricultural produce, essential food items, relief supplies, military goods, and certain low-value consignments are tax-exempt.

Vikash

26 Sep 2025 • 3 min read

GST has brought transparency and structure to taxation in transport services, using the HSN/SAC code 9965 for most goods transportation services. Knowing how GST applies to transport helps businesses stay compliant and optimize costs.

What is HSN Code 9965?

HSN Code 9965 refers to goods transport services, including by road, rail, waterways, air, and even space, classified under the GST regime for easier compliance and invoicing. This code covers a wide range of logistics solutions for moving goods within and outside India.

GST Rates & Exemptions for HSN Code 9965

Type of Service/Mode	HSN Code	GST Rate	ITC Allowed?	Key Notes/Exemptions
Goods Transport Agency (GTA), Forward Charge	9965	5%	No	Supplier pays tax, no ITC
Goods Transport Agency (GTA), Reverse Charge	9965	12%	Yes	Recipient pays tax, ITC allowed
Transport by Rail	9965	5%	No	ITC not allowed, very few exceptions
Transport by Ropeways, Pipelines	9965	5%/18%	No (5%), Yes (18%)	Varies by pipeline/goods type
Transport by Vessel (Sea, Inland)	9965	5%/Nil	No (5%), NA (Nil)	Nil for certain exempt goods and use cases
Transport by Air	9965	18%	Yes	ITC available, except imports to customs station (Nil)
General Goods Transport Services	9965	18%	Yes	All other goods not covered above
Road Transport other than GTA/Courier/Inland Waterways	9965	Nil	NA	E.g., direct trucking, not a GTA
Exempt Transport Services	9965	Nil	NA	Agriculture produce, milk, salt, food grains, relief goods, etc.

Table Notes

ITC = Input Tax Credit.
Nil GST applies when transporting eligible agricultural, food, relief, or defense goods, and select services as notified by the GST council.
9965 covers road, rail, air, sea, and pipeline services for goods, with subclassifications for detail.

Explore Gimbooks HSN/SAC code & GST Rate finder

GST Rates Applicable Under 9965

The GST rate on transportation services under HSN 9965 varies based on the transport mode and service conditions:

Goods Transport Agency (GTA) Services: 5% (without input tax credit – ITC), or optionally 12% (with ITC).
Transport by Railways, Pipelines, or Ropeways: 5% (ITC restrictions apply).
General goods transport services (other than specified categories): 18%.
Transport by road (not by GTA/courier/inland waterways): NIL.
Transport of certain goods (agricultural produce, milk, newspapers, relief materials): Exempt.

What’s Included in 9965 Services?

HSN 9965 covers almost all services related to moving goods:

Road transport (by trucks, trailers, etc.)
Rail, air, coastal and inland water transport
Pipeline transport (natural gas, petroleum, etc.)
Specialized logistics (live animals, refrigerated cargo, intermodal containers, etc.).

Key Exemptions Under GST for 9965

Several types of goods and situations are exempt from GST under 9965 when specific criteria are met:

Agricultural produce, food grains, milk, salt, organic manure
Relief and disaster supplies
Newspapers and registered magazines
Goods carried for the military.

Input Tax Credit (ITC) Rules for Transport Services

5% GST rate: ITC on input goods/services not allowed
12% GST rate (GTA): ITC is permitted
18% GST rates: ITC is permitted as per standard GST rules.

GST on Freight Charges: Practical Scenarios

Freight for Import/Export: Services transporting goods to or from a customs station in India may have different GST rates (including exemptions), especially via air or sea.
Domestic Transportation: Rates depend on service provider (GTA or not) and nature of goods.

Learn more - HSN Code List And GST Rate Finder: Important Facts You Should Know

Common Mistakes in Transportation GST

Using incorrect HSN/SAC codes on invoices
Not availing eligible exemptions
Misunderstanding ITC eligibility

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Conclusion

Understanding HSN 9965 ensures proper GST compliance for any business engaged in goods transportation. Stay updated with GST Council notifications for any rate changes or rule updates.