Understanding Goods and Services Tax on Mattresses in India
The Goods and Services Tax (GST) framework in India impacts the mattress market, classifying these products under HSN Chapter 94. While most mattresses are taxed at 18%, certain types like pneumatic mattresses attract a 12% rate. This article details the GST classification, applicable rates, and rules for inter-state versus intra-state supplies. It also examines the availability of Input Tax Credit (ITC) and reviews relevant advance rulings concerning mattress-related products.
The Indian market for high-quality mattresses was valued at $1.7 billion in fiscal year 2018-19, with projections indicating a growth to $2.8 billion by FY24. The organized segment, currently accounting for 35% of the market, is expected to reach 40% by FY24. This article clarifies the applicability of Goods and Services Tax (GST) on mattresses in India.
Scope of Mattress Taxation Under GST
Mattresses are categorized as miscellaneous manufactured articles under Chapter 94 of the CGST Act 2017. This chapter groups mattresses and mattress supports with other furniture and similar furnishings for GST purposes. Initially, mattresses, including coir mattresses, were subject to a 28% GST rate when the GST regime was launched. However, following the 23rd meeting of the GST Council on November 10, 2017, the GST rate on mattresses was reduced to 18%.
It is important to note that pneumatic and water mattresses are excluded from Chapter 94. These specific types of mattresses are instead covered under chapters 63, 39, and 40, attracting a lower GST rate of 12%.
Determining the Place of Supply
The treatment of GST for mattresses varies based on the place of supply. If mattresses are transported between different states, it is considered an inter-state supply. Such transactions are subject to Integrated Goods and Services Tax (IGST).
Conversely, if mattresses are supplied and delivered within the same state, this constitutes an intra-state supply. These supplies incur both Central Goods and Services Tax (CGST) and State Goods and Services Tax (SGST).
GST Rates and HSN Codes for Mattresses
Most mattresses are subject to an 18% GST rate, with the exception of pneumatic mattresses, which attract a 12% GST. Mattresses and mattress supports are classified under HSN Chapter 94, titled 'Miscellaneous Manufactured Articles.' This chapter specifically excludes water and pneumatic mattresses, which fall under chapters 39, 40, or 63 of the CGST Act, 2017.
The Harmonized System of Nomenclature (HSN) Code for mattresses is 9404. This code encompasses mattress supports, various bedding articles, and furnishings like mattresses. It includes mattresses that are stuffed, fitted with springs, internally equipped with materials, or made from plastics or cellular rubber, regardless of their covering.
The following table details the HSN codes and GST rates for various mattress types:
| Description | HSN Code | GST Rate |
|---|---|---|
| Mattress supports | 9404 10 00 | 18% |
| Covered and uncovered mattresses made of cellular rubber | 9404 21 10 | 18% |
| Covered and uncovered mattresses made of plastics | 9404 21 90 | 18% |
| Mattresses with spring interiors | 9404 29 10 | 18% |
| Mattresses made of rubberised coir, with or without metallic springs, or in combination with other materials | 9404 29 20 | 18% |
| Mattresses of other remaining materials | 9404 29 90 | 18% |
| Cotton pneumatic mattress | 6306 41 00 | 12% |
| Pneumatic mattresses made of textile materials, other than cotton | 6306 49 00 | 12% |
For more details on GST rates and HSN codes for furniture, refer to this resource: Chapter 94 Furniture, Mattresses, Cushions, Lamps, Lightings, Illuminated Signs, Name Plates GST Rate HSN Code.
Input Tax Credit (ITC) Availability on Mattresses
Registered taxpayers are generally permitted to claim Input Tax Credit (ITC) on goods and services used to further their business, as per Section 16(1) of the CGST Act 2017. However, these claims are subject to specific limitations outlined under Section 17(5) of the CGST Act.
Advance Rulings Pertaining to GST on Mattresses
Order No. 17/ARA/2020, dated 20th April 2020
Case Details: M/s. Global Textile Alliance India Private Ltd., a manufacturer of fabrics, sought an advance ruling regarding the correct classification and applicable GST rates for fabric-based mattress covers. The company produced covers using knitted and woven fabrics and proposed classification as 'made-ups' under Section 11 of the Customs Tariff Act, 1975. They suggested a 5% GST for covers priced under Rs. 1,000 and 12% for those over Rs. 1,000, aligning with Schedule 1 of the CGST Act, 2017.
Ruling: The Tamil Nadu Authority for Advance Ruling (AAR) determined that mattress covers fall under HSN 6304. Therefore, mattress covers made of woven or knitted fabrics are classified under HSN 6304 19 90. The AAR confirmed that these goods, if costing below Rs. 1,000, would be taxed at 5%. Goods priced above Rs. 1,000 would incur a 12% GST, in accordance with Notification Number 1/2017 CT (R), dated June 28, 2017.
TSAAR Order No. 8/2018, dated 20th July 2018
Case Details: M/s. Victory Comfort Products requested an advance ruling to clarify the taxability of coir sheets, including rubberized coir blocks and sheets. These sheets are utilized in manufacturing mattress layers, packaging, and carpet underlays. The applicant identified their product under HSN code 9404 but was uncertain whether these coir sheets should be categorized as coir products, potentially attracting a 12% or 5% GST based on recent government notifications.
Ruling: The Telangana State Authority for Advance Ruling concluded that the applicant's products are derived from coir fiber. While initially subject to 12% GST upon the implementation of the GST regime, Notification Number 1/2017 CT (R), dated June 28, 2017, subsequently revised the GST for these coir products to 18% under Schedule 3 of the notification.
Since the introduction of the GST framework, the Indian mattress market has experienced increased organization. Although mattresses were initially placed in the highest GST slab at 28%, the tax rate was promptly adjusted to 18%. With significant expansion in both organized and e-commerce segments, the government's revenue is expected to benefit from these GST rates on mattresses.