GST and Sales Tax Rates for Footwear in India

The Goods and Services Tax (GST) rate for footwear in India is subject to several factors, making it important to understand the different rates and exemptions applicable to both imported and locally manufactured footwear.

The Current GST Rates for Footwear

As of January 1, 2022, the GST rate for footwear has changed based on the retail price (MRP) of the footwear.

Footwear with MRP Below Rs. 1000

Footwear with a manufacturers' recommended price (MRP) below Rs. 1000 is now subject to a 5% GST rate, down from a previous full exemption. This change affects only such footwear that was previously fully exempt from GST.

Footwear with MRP Above Rs. 1000

Footwear with an MRP exceeding Rs. 1000 is subject to a 12% GST rate. However, for footwear with an MRP above Rs. 1000, the GST rate has been increased to 18%, affecting all such items.

Additional Points to Consider

While the GST rate is a significant factor, the total cost of footwear can also include sales tax or other additional charges imposed by individual states. Here are some additional points to consider:

Sales Tax and VAT by State

Sales tax is a state subject, and each state in India may have its own applicable VAT rate on footwareshopping in one state may be subject to a different tax rate than in another. To find the specific rate, you should check the website of the respective state's sales tax department or VAT schedule.

Factors Influencing the Overall Tax Rate

The overall tax on footwear can vary based on several factors, including the type of material used (rubber or plastic for the outer sole and uppers), the manufacturing process (e.g., stitching, riveting, nailing, etc.), and the location of sale. Waterproof footwear with outer soles and uppers made of rubber or plastic that are not fixed to the sole by conventional means is subject to an 18% GST rate.

Location and Manufacturer

The sales tax or VAT you may encounter can also depend on where the footwear was manufactured and the state in which it is sold. For instance, imported footwear may be subject to import duty, in addition to the GST and sales tax.

How to Find Specific Rates

To find the exact GST and sales tax rates for a specific product, such as footwareshere are a few steps you can take:

Check the website of the respective state's sales tax or VAT department. Review the rate schedule available on their website. Consult a local tax expert or retailer for further clarification.

It is crucial to understand these nuances to ensure accurate pricing and avoid any unexpected charges.

Conclusion

Understanding the current GST and sales tax rates for footwear in India is essential for both consumers and businesses. Knowing the factors that influence these rates can help you make informed decisions when purchasing or selling footwear. For the most accurate and up-to-date information, always consult the relevant state department or a tax professional.