Laptop HSN code is 84713020 and the GST applicable to products under this coding system is 18%. Read the article to gather across-the-board knowledge on HSN codes.
The GST Council decides the GST margin to be levied on revenue earned by selling various goods and services. You should know that the GST rate associated with goods solely relies on HSN codes. The taxation bracket can range up to 28% with the least margin as low as 0%. This blog will cover the laptop hsn code along with GST applicable on laptops, PCs and related electronic devices.
Understanding Hsn Code
HSN stands for Harmonized Structure of Nomenclature. Initially, the Indian Government had deployed a six-digit HSN or HS system to organize various types of products. Later on as the technology advanced and many new solutions ushered in, the Government decided to introduce two more numbers forming the tail of the new coding system.
For computers, laptops and related devices, the preliminary coding is given as 8471. Here, (84) or the initial two digits address the chapter number. Chapter 84 includes mechanical instruments like computers in addition to boilers and nuclear reactors. The following two digits, i.e., 71 specifically describe automatic data handling machines that can receive, process and forward information in coded format.
Relation Between HSN Code and GST
Identification of the appropriate HSN Code for a particular product is mandatory as the GST levied on revenue earned through the selling of that good is determined by referring to the HSN code. If you have found the HSN, then determining the GST rate becomes much easier.
What Determines the Gst Rates in India?
The GST Council is responsible for fixing the GST ratio applicable to various classes of products and services. The Council keeps on changing the tax rates quite frequently depending on the minutes of meetings held among the core members forming the Board.
Lately, the GST tax collection has been reported to surpass the projections, therefore, the Indian Government is vigorously looking for ways to reduce the GST rates across certain categories of goods.
HSN Code for Laptop
HSN codes under Chapter 84 cover all personal computers, micro-computers, laptops and other related devices manufactured all over India. We can refer to this data by going through the subject matter described under the heading – Automatic Data Handling Machines & Units within Chapter 84.
8471 is the designated four-digit HSN protocol used to represent computers. The GST margin fixed against this code is 18%.
The phrase, automatic data handling machine, in Chapter 84 has been incorporated to exemplify any electrical device that can:
- Store singular or multiple processing software alongside the supporting data that is instantly required for the smooth running of all installed programs;
- Provide a flexible interface that can be readily modified to suit the needs of a user;
- Execute arithmetical operations if asked by the user;
- Implement logical reasoning to run multiple processing programs that can be run without human mediation
Apart from the aforementioned criteria, an automatic data handling machine must appear in the form of a singular component or system that is capable of hosting several other subunits. Any subunit that is linked to the preliminary data handling device satisfying all the highlighted solutions would also be categorized as data handling equipment falling under the HSN Code – 8471.
The applicable subunits paired with automated data handling systems are actively utilized to achieve various computational goals. These devices are linked to the CPU for daily operations either directly using wires or via some intermediary unit. They are also included within the 8471 code.
Before registering for GST, calculate GST amount that needs to be paid using our GST calculator.
These supporting gadgets like the mouse, printer, keyboard, and USB storage units are enabled to receive and forward valuable information in the form of signals. The computer system will become non-functional if the performance of these subunits fluctuates.
Tax Levied on Laptops
Before GST became effective, sellers incurred a cost of 14% on the net revenue earned by trading laptops in the Indian market. This margin was known as VAT. The VAT could also be as high as 15% depending on the state where the transaction is taking place.
Now a fixed tax rate has been set on laptops under the GST rule just like the regulations established for other products and services. Customers are now asked to pay 18% GST which is calculated on the maximum retail price of the laptop.
HSN Code for Computer Hardware and Software
As we have already discussed 8471 is the common four-digit number used to form various HSN codes that are assigned to computing tools, now we are going to see the full HSN code for multiple accessory units.
847160 is the HSN protocol that represents printing devices. The same six-digit code applies to all input components of the computer system as well, such as the mouse, scanner, keyboard and so on.
When we move on to the storage instruments like hard disks, flash drives and others then the code gets changed to 847170. 847130 on the other hand, signifies portable automatic data handling digitalized devices that weigh less than 22 pounds. In simple words, 847130 is the six-digit HSN code for personal computers that are used in offices and domestic settings.
In a table, we have jotted down the detailed list of HSN Code devices breaking down the individual elements that are deployed to run a system.
| Complete 8-digit HSN | Electronic Item Specification |
| 84713010 | PCs |
| 84713090 | Other portable computational devices |
| 84714110 | Computers running on microprocessors – a microcomputer |
| 84714120 | Main frame computer |
| 84715000 |
Processing components that are not covered under 847149 and 847141. These devices should serve the purpose of output/input/storage units. |
| 84714900 | Computational systems |
| 84716010 | Combined units (both input and output components) |
| 84716025 | Plotter |
| 84716024 | Printer |
| 84716060 | Mouse |
| 84716050 | Scanning device |
| 84716040 | Keyboard |
| 84717020 | Hard disk |
| 84717060 | CDs |
| 84717030 | USB drives |
How are GST rates fixed?
Goods and Services Tax (GST) rates in India are determined through a multi-tiered system involving the GST Council, which consists of representatives from the central and state governments. The GST rates are fixed based on the following principles:
- GST Council:
– The GST Council is the key decision-making body responsible for fixing GST rates. It is chaired by the Union Finance Minister of India and includes finance ministers from all the states and union territories. The Council meets regularly to discuss and decide on various aspects of GST, including rate changes.
- Multi-Tiered GST Structure:
– India follows a multi-tiered GST structure with different tax rates for different categories of goods and services. The GST Council has categorized goods and services into five broad tax slabs: 0%, 5%, 12%, 18%, and 28%.
- Revenue Neutral Rate (RNR):
– The concept of the Revenue Neutral Rate (RNR) is considered when fixing GST rates. The RNR is the rate at which the government would neither lose revenue nor gain revenue due to the implementation of GST. The actual rates are then adjusted based on the revenue requirements of the government.
- Essential vs. Luxury Goods:
– Essential goods and services that are considered basic necessities generally attract lower GST rates, while luxury items or non-essential services may have higher rates. This differentiation helps in ensuring that essential commodities remain affordable.
- Input Tax Credit:
– The availability of Input Tax Credit (ITC) is a crucial factor. GST allows businesses to claim credit for the taxes they paid on inputs. The consideration of ITC helps in determining the final tax burden on the end consumer.
- Revenue Impact:
– The revenue impact of rate changes is carefully evaluated. The GST Council assesses the potential impact on government revenue and ensures that any rate adjustments are revenue-neutral or within acceptable limits.
- Public Interest and Socioeconomic Factors:
– The GST Council considers public interest and socioeconomic factors when fixing rates. The aim is to strike a balance between generating government revenue and safeguarding the interests of consumers, especially those belonging to economically vulnerable sections.
- Sector-Specific Considerations:
– Certain sectors may have specific considerations. For example, the real estate sector or items like petroleum and alcohol may be subject to special provisions, and the GST Council takes these into account when fixing rates.
GST on Computers and Other Related Products: Laptop HSN Code and GST rate/Desktop HSN code and GST
| PARTICULARS | GST RATE |
| Laptop | 18% |
| Desktop Computer | 18% |
| Optical Drives | 18% |
| Memory Chips (RAM) | 18% |
| Hard Drive | 18% |
| External Hard Drive | 18% |
| Pen Drive | 18% |
| Desktop Monitor (upto 32 inches, LED/LCD) | 18% |
| Desktop Monitor (more than 32 inches, LED/LCD) | 28% |
| Laptop Adapter | 28% |
HSN code for laptop/ Desktop computer HSN code and other related products –
- 8471 – Four digit HSN Code for computers, desktop hsn code for PCs, laptop hsn code, and other kinds of personal computers.
- 8471 – Four digit HSN code for USB storage devices, keyboards and printers.
- 847160 – Six digit HSN code for printers.
- 847160 – Six digit HSN code for mouse, keyboard and other input devices.
- 8471 70 – Six digit HSN code for hard disks, USB drives and other storage devices.
Conclusion
HSN code is devised to distinguish various classes of products that are somewhat closely related in terms of services and functionality. Based on the HSN protocol, the Government has fixed GST rates: https://www.gst.gov.in/ that a consumer needs to furnish while buying a commodity from the open market. Laptop HSN Code is 84713020 and the GST fixed against products under this code is 18%.
The exclusive team of Vakilsearch researches such critical taxation protocols to keep you ahead of other consumers so that you possess a well-informed and sound purchasing power. If you find this article helpful you may read the other GST blogs on our site.
Also, Read:
