Changes in Compensation Cess Rate Notification w.r.t. supply of certain goods from January 01, 2022 to align it with HS 2022



Quick Summary
The Central Board of Indirect Taxes and Customs (CBIC) has updated the GST Compensation Cess rates, effective from January 1, 2022. These changes align the rates with the new HS 2022 nomenclature, which includes significant amendments to the classification of goods. The notification specifically revises the HSN codes and descriptions for certain tobacco products and aircraft used for personal purposes.

Background

Earlier, the CBIC issued Notification No.1/2017-Compensation Cess (Rate) dated June 28, 2017 ("the Compensation Cess Rate Notification") in order to notify the rate of GST compensation cess to be levied on the intra-State supplies or inter-State supplies of certain goods mentioned therein.

Further, the new (seventh) edition of the Harmonized System (HS) nomenclature i.e., HS-2022, has come into force from January 01, 2022. This edition has introduced significant changes to the Harmonized System with a total of 351 amendments at the six-digit level, covering a wide range of goods moving across borders.

As India is a party to the HS convention, necessary changes were brought in accordingly, in GST through the below mentioned notification:

GST Compensation Cess Rate Changes Jan 2022

Notification

The CBIC vide Notification No. 2/2021-Compensation Cess (Rate) dated December 28, 2021 has amended the relevant entries of the Compensation Cess Rate Notification w.e.f. January 1, 2022, in the following manner:

 

S. No.

Old HSN

Old Entry

New HSN

New Entry

25

2403 91 00

"Homogenised" or "reconstituted" tobacco, bearing a brand name

2403 91 00 or 2404 11 00

"Homogenised" or "reconstituted" tobacco, bearing a brand name

37

2403 99 90

All goods, other than pan masala containing tobacco 'gutkha', bearing a brand name

2403 99 90 or 2404 11 00 or 2404 19 00

All goods, other than pan masala containing tobacco 'gutkha', bearing a brand name

38

2403 99 90

All goods, other than pan masala containing tobacco 'gutkha', not bearing a brand name

2403 99 90 or 2404 11 00 or 2404 19 00

All goods, other than pan masala containing tobacco 'gutkha', not bearing a brand name

54

8802

Other aircraft (for example, helicopters, aeroplanes), for personal use.

8802 or 8806

Other aircraft (for example, helicopters, aeroplanes), for personal use.

 

The Notification can be accessed here


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