Transport GST Rate in India 2026: GTA, RCM & Truck Owners

Transport GST rate in India (2026): a goods transport agency (GTA) charges 5% GST without input tax credit, or 18% with ITC. The 18% option replaced the earlier 12% option on 22 September 2025. If the shipper pays under reverse charge (RCM), the rate is 5%. Renting a truck to a GTA is exempt.

Last updated: 27 October 2026. Source for the GTA rates: PIB, FAQs on the 56th GST Council decisions.

India’s trucking sector moves approximately 4.6 billion tonnes of freight annually. As this critical industry expands, truck owners and businesses relying on trucking services must understand how Goods and Services Tax (GST) applies to their operations. This guide covers GST implications for both Goods Transport Agencies (GTA) and truck owners, exploring rates, schemes, and available exemptions.

What is GST?

GST (Goods and Services Tax) is a comprehensive indirect tax on the supply of goods and services in India. Registration requirements vary:

• Normal States: Annual turnover exceeding Rs. 40 lakh requires GST registration
• Special Category States: North-Eastern and hilly regions have lower thresholds at Rs. 10 lakh annually

I. GST for Goods Transport Agency

GTA Meaning (Goods Transport Agency)

According to Central Tax (Rate) dated 28/06/2017, a Goods Transport Agency is defined as a company that transports goods by road and issues a receipt, known as a consignment note. GTAs act as intermediaries connecting shippers with carriers while handling logistics, documentation, and insurance.

GTA Services Under GST

GTA services include:

• Issuing serially numbered consignment notes for tracking goods
• Arranging packing, loading, unloading, and storage
• Ensuring safe, timely goods delivery
• Managing shipment paperwork and documentation

Consignment Note Under GST

The GTA issues serially numbered consignment notes upon receiving goods for transport. This key document outlines:

• Consignor (sender) and consignee (receiver) details
• Goods description and quantity
• Origin and destination
• GST payment responsibility

GST Rate on GTA

Registered GTAs must charge GST on transportation services. The payer varies depending on the circumstances.

Forward Charge Mechanism (FCM)

The GTA itself pays GST, with two options:

1. 5% GST Without ITC:

• Simpler structure
• GTA charges recipient 5% and pays government directly
• Cannot claim Input Tax Credit on business purchases
• May increase overall operational costs

2. 18% GST With ITC (replaced the 12% option on 22 September 2025):

• Allows claiming ITC on eligible purchases (fuel, maintenance, etc.)
• GTA charges recipient higher rate (18%)
• Requires detailed record maintenance
• Potentially reduces overall tax liability

Returns Filed by GTA:

• GSTR-1: Monthly/quarterly return detailing outward supplies
• GSTR-3B: Monthly/quarterly summary of tax liability
• GSTR-9: Annual return providing comprehensive transaction overview

Reverse Charge Mechanism (RCM) on Freight

The recipient pays GST at a flat 5% rate. GTAs need not file GSTR-1 or GSTR-3B under RCM, though GSTR-9 may be required depending on overall transactions. This applies when recipients fall under specific categories:

• Factories (under Factories Act, 1948)
• Registered societies and co-operatives
• Body corporates and PSUs
• Partnership firms (registered or unregistered)
• Any GST-registered business
• Casual taxable persons

GTA Exemptions Under GST

1. Based on Specific Goods:

• Agricultural produce
• Milk, salt, and food grains
• Organic manure
• Defense/military equipment
• Newspapers and magazines
• Relief materials

2. Based on Transaction Value:

• 1. Single consignment transportation charges not exceeding Rs. 1,500 are exempt
• 2. Total charges for all goods to a single consignee below Rs. 750 are exempt

Based on Entity:

• 1. Central and state government departments
• 2. Local authorities and governmental agencies

II. GST for Truck Owners/Small Fleet Owners

When purchasing new trucks, GST applies at 18% (effective Sep 2025). For example, a Rs. 40 lakh truck incurs Rs. 7.2 lakh additional GST. However, owners may claim this as Input Tax Credit.

1. Operating Truck Yourself

Registered Business (FCM): Responsible for collecting and depositing GST with the government at 18% rate with Input Tax Credit eligibility.

Unregistered Business (RCM): May fall under RCM in certain situations when receiving services from larger GST-registered companies. Shippers pay 5% for taxable goods.

2. Renting Truck to a Goods Transport Agency (GTA)

Renting trucks to GTAs is exempt from GST, regardless of the owner’s GST registration status. No GST collection or payment is required in this arrangement.

Summary Table

GST on Freight Charges: SAC Code and Loading Charges

GTA services are commonly billed under SAC 996791 (road goods transport agency services). Check the SAC code on your invoice with your tax advisor, since the same code is used for the 5% and 18% options.

Loading and unloading (hamali) charges that the GTA bills together with the freight are generally treated as part of the same composite supply, so they are taxed at the same rate as the freight. CBIC’s FAQ on GTA services describes transport of goods by road as a composite service. Hamali paid separately to a labour contractor is a different supply, so ask your advisor how it applies to you.

GST on Freight: 5% vs 18% on Real FR8 Lanes

GST is charged on the freight amount. These are FR8’s freight rates for a 32 ft MXL container truck on busy lanes, from FR8 completed trips, with the GST each option adds. The GST column is arithmetic on the freight; your invoice may differ.

Freight is per trip from FR8's completed trips. Updated 11 Nov 2026.

Which Rate Applies to Your Trip

The 5% column applies if the transporter chose the no-ITC option or you pay under RCM. The 18% column applies only if the transporter chose the ITC option. Ask for the choice in writing before you compare quotes, because the same freight can differ by 13 percentage points of GST.

To see what freight costs on other lanes, read our truck transport charges in India guide.

Conclusion

Truck owners and GTAs operate as vital components of India’s logistics network. Understanding GST enables efficient navigation of the system and ensures smooth business operations. For situation-specific guidance, consulting with a tax advisor familiar with the trucking industry is recommended.

Frequently Asked Questions

What is the GST rate on goods transport by a GTA?

A goods transport agency (GTA) charges 5% GST without input tax credit, or 18% with ITC. The 18% option replaced the 12% option on 22 September 2025.

Who pays GST on transport, the transporter or the shipper?

It depends. Under the forward charge the GTA collects and pays the GST. Under reverse charge (RCM) the recipient, such as a registered business, factory, society or firm, pays 5% directly to the government.

Is GST charged when I rent a truck to a GTA?

No. Renting trucks to a GTA is exempt from GST, whether or not the owner is GST-registered.

What is RCM on freight?

RCM (reverse charge) on freight means the recipient of the GTA service, such as a registered business, factory, society or firm, pays 5% GST directly to the government instead of the GTA collecting it.

What is the SAC code for GTA services?

GTA services are commonly billed under SAC 996791. Confirm the code for your invoice with a tax advisor.

Is GST charged on loading and unloading (hamali) charges?

When the GTA bills loading and unloading with the freight, they are generally part of the same composite supply and carry the freight’s GST rate. Hamali paid separately to a labour contractor is a different supply, so check with a tax advisor.

What transport is exempt from GST?

Transport of specific goods such as agricultural produce, milk, salt, food grains and newspapers, single consignments up to Rs. 1,500, and transport for government departments and local authorities. See the exemptions list above.

Check truck rates at fr8.in or FR8 truck booking app.