Transport HSN Codes for Logistics Services: Complete Business Guide

Transport HSN (Harmonized System of Nomenclature) codes are crucial for GST compliance in India’s logistics industry. These six-digit codes classify different types of transport and logistics services, determining the applicable GST rates and regulatory requirements. Here’s a comprehensive guide to help businesses navigate transport HSN codes effectively.

What Are Transport HSN Codes?

HSN codes are standardized classification codes used under the GST regime to categorize services systematically. For transport and logistics, codes beginning with “99” fall under the services chapter, with specific codes assigned to different types of transport operations. These codes are mandatory to mention on invoices for proper tax compliance and enable accurate GST calculation.​

Main Transport HSN Code Categories

HSN Code 9964: Passenger Transport Services

This code covers the movement of passengers with their baggage across all modes of transportation. The applicable GST rate varies based on the type of service:​

• Local passenger road transport: 5% without ITC or 18% with ITC
• Long-distance bus and coach services: 5% without ITC or 18% with ITC
• Scheduled air passenger services: 5% without ITC or 18% with ITC
• Water transport of passengers: 5% rates apply
• Sightseeing transportation services: 5% without ITC or 18% with ITC

HSN Code 9965: Goods Transport Services

This is the primary code for freight and cargo transportation, covering movement of goods by any mode. The code is further subdivided based on transport mode and service type:​

HSN Code 9966: Vehicle Rental Services

This code covers the rental or leasing of vehicles, typically applied when providing transport equipment without actual movement of goods:​

• Motor vehicle rental with fuel included: 5% with ITC
• General vehicle rental (buses, trucks, cars): 18% with ITC
• Vessel rental: 18% with ITC
• Aircraft rental: 18% with ITC

HSN Code 9967: Supporting Services in Transport

Supporting services that enable transport operations fall under this code and attract 18% GST:​

• Cargo handling and container services (996711)
• Customs house agent services (996712)
• Clearing and forwarding services (996713)
• Storage and warehousing services (996721-996729)
• Freight forwarding
• Port and terminal operations
• Airport handling services

Goods Transport Agency (GTA) Services – A Special Category

GTAs occupy a special position in logistics. These are entities that provide transport services by road and issue consignment notes. GTAs have a unique GST structure for their services under code 996791:​

GTA Options:

• 5% GST without ITC: The GTA pays 5% GST and cannot claim input tax credit
• 18% GST with ITC: The GTA pays 18% GST but can claim full ITC on business inputs

This dual option allows GTAs to choose based on their input credit structure and operational efficiency.​

Key Tax Exemptions

Several categories of goods transportation are exempt from GST entirely, regardless of the HSN code used:​

• Agricultural produce transportation
• Milk, salt, and food grains (including flour, pulses, rice)
• Organic manure
• Newspapers and magazines (registered)
• Relief materials for disaster victims
• Defence and military equipment
• Transportation charges below ₹1,500 per single carriage

Practical Invoice Requirements

When issuing invoices for transport services, businesses must:​

1. Mention the correct HSN code: Place the six-digit code on every invoice
2. Specify the transport mode: Ensure the code matches the actual mode of transport used
3. Clearly state GST rate: The applicable percentage based on the HSN code
4. Document service details: Description must match the chosen HSN code

For example, a road transport invoice for a GTA should use code 996791 with either 5% or 18% GST clearly stated, along with the basis for ITC claim eligibility.

Common Scenarios for Businesses

Scenario 1: Road Freight by a Goods Transport Agency

• Use HSN Code: 996791
• GST Rate: 5% (without ITC) or 18% (with ITC)
• Invoice must clearly mention the chosen option

Scenario 2: Domestic Air Cargo

• Use HSN Code: 996531
• GST Rate: 0% (exempt)
• No GST applicable

Scenario 3: Warehouse and Storage Services

• Use HSN Code: 996729
• GST Rate: 18% with ITC
• Supports goods already in transport

Scenario 4: Vehicle Rental for Freight Operations

• Use HSN Code: 996601
• GST Rate: 18% with ITC
• Applies when renting vehicles rather than providing transport service

Compliance Best Practices

Accurate Code Selection: The HSN code must accurately reflect the service provided. Using incorrect codes can result in:

• GST liability adjustments
• Interest and penalties
• Failed tax audits
• Reputational damage

Documentation: Maintain clear records showing:

• Mode of transport used
• Type of goods transported
• Distance and route details
• Consignment notes (for GTAs)
• Supporting service details

ITC Management: Understand which code-rate combinations allow input tax credit:

• GTA services at 18%: Full ITC allowed
• GTA services at 5%: No ITC allowed
• Supporting services (9967): Generally 18% with ITC
• Vehicle rental (9966): Primarily 18% with ITC

Recent GST Updates

As of September 2025, the GST Council has rationalized certain transport service rates to streamline the logistics sector. Key changes include:​

• Passenger transport services now offer clearer options between 5% without ITC and 18% with ITC
• Vehicle rental services have been standardized at primarily 18% with ITC for standard rental scenarios
• Supporting services continue to be taxed at 18% with ITC

Understanding and correctly applying transport HSN codes ensures businesses maintain compliance while optimizing their GST liability. The choice of code directly impacts the tax burden and available input credits, making accurate classification essential for financial planning in logistics operations.