Change In GST rate for GTA

The ability for a Goods Transport Agency (GTA) to switch between FCM and RCM is generally restricted to the beginning of a financial year. The recent GST rate revisions, effective from September 22, 2025, do not appear to change this fundamental rule.

To make the switch, a GTA is required to file a specific form (like Annexure V for opting for FCM) by a specified deadline, usually before the end of the preceding financial year. Once a GTA chooses an option (FCM or RCM) for a financial year, it is considered to be exercised for future financial years unless a new declaration is filed to revert the decision.

Yes, there are specific GST rates for multimodal transport, which is defined as the transportation of goods by at least two different modes of transport under a single contract. The applicable GST rate depends on whether air transport is involved.

When no leg of transport is by air:

The GST rate is 5% with restricted input tax credit (ITC).The ITC is limited to the input services of transportation of goods and is capped at 5% of the value of the service.

When at least one leg of the transport is by air:

The GST rate is 18% with full input tax credit (ITC).

In this case, the transporter can avail the entire ITC on all inputs and input services.

These rates and conditions are distinct from the options available to a GTA, which primarily deals with road transport. Multimodal transport services are generally taxable on the supplier (the Multimodal Transport Operator), unlike some GTA services where RCM may apply.

Refer:::  https://www.pib.gov.in/PressReleseDetailm.aspx?PRID=2167151

The recent change in GST rate for GTA (Goods Transport Agency) services has created a significant impact on businesses that depend on logistics and freight movement. Earlier, transporters had the option to choose between paying GST at 5% without input tax credit (ITC) inat tv box indir or at 12% with ITC, but under the revised structure, uniformity has been brought in to simplify compliance. This shift not only affects the cost of transportation but also influences how companies manage their input credits and overall supply chain expenses.

Will you please clarify more ! None my questions has been answered through your comment !

After 22/09/2025, in case of Unregistered Transporter (GTA), whether 18% GST can be paid under RCM (Reverse Charge) by Recipient and full ITC (Input Tax Credit) can be claimed ? [or only 5% GST has to be paid under RCM without ITC ?]

• For transportation of goods by an unregistered GTA, the recipient must pay GST at 5% under RCM.

• The recipient may claim full ITC on the GST paid under RCM, provided all requirements under Section 16 and 17 of the CGST Act are satisfied and goods/services are used for business.

• The 18% GST rate with ITC is not applicable for unregistered GTA under RCM; it is relevant only for certain other transport services or if the GTA opts for Forward Charge, which is not the case with unregistered providers.

• The GST Council, through its 56th meeting, kept the merit rate for GTA services at 5% (without ITC for GTA but ITC available for the recipient under RCM).

• So,  after 22 September 2025, under RCM for unregistered GTA, only 5% GST should be paid by the recipient, and full ITC may be claimed if business use conditions are satisfied.

GST 2.0 consolidated the earlier GTA rate options under a simplified structure. Here is the current position effective September 22, 2025.

Under RCM (most common): If the recipient is a registered person, they pay GST at 5% on the freight amount under RCM. ITC is NOT available on this 5% paid under RCM for GTA services received in the course of business.

Under Forward Charge: If the GTA opts into forward charge, the rate is 12% with full ITC. The GTA must file a declaration opting for forward charge at the start of the financial year.

Nil rate: Still applicable when the consignment value is below Rs 1,500 (single carriage) or Rs 750 (single consignee), or if goods moved are agricultural produce, relief goods, milk, newspapers, etc.

Key compliance point: If you are a recipient paying under RCM, remember that RCM liability is to be disclosed and paid in Table 3.1(d) of GSTR-3B. Many registrants miss this and end up with scrutiny notices later.

This [GST on transportation and GTA guide](https://taxgarden.in/blog/gst-on-transportation-freight-gta-rcm-india-2026) has the full rate table and RCM vs forward charge comparison.