Important Keyword: GST Notification 27/2019, GST Council 38th meeting, woven bag GST India, FIBC GST rate, Notification 01/2017 amendment,
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Table of Contents
[F.No.354/201/2019-TRU]
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
(Department of Revenue)
New Delhi, the 30th December, 2019
Notification No. 27/2019 - Central Tax (Rate): Seeks to further amend notification No. 01/2017-Central Tax (Rate), to change the rate of GST on goods as per recommendations of the GST Council in its 38th Meeting.
GST: [TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)]
G.S.R. (E).- In exercise of the powers conferred by sub-section (1) of section 9 and sub-section (5) of section 15 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on the recommendations of the Council, hereby makes the following further amendments in the notification of the Government of India in the Ministry of Finance (Department of Revenue), No.1/2017-Central Tax (Rate), dated the 28th June, 2017, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 673(E), dated the 28th June, 2017, namely:-
In the said notification, -
- in Schedule II - 6%, serial numbers 80AA and 171A and the entries relating thereto shall be omitted;
- in Schedule III - 9%, after serial number 163A and the entries relating thereto, the following serial numbers and entries shall be inserted, namely: -
| “163B | 3923 or 6305 | Woven and non-woven bags and sacks of polyethylene or polypropylene strips or the like, whether or not laminated, of a kind used for packing of goods; |
| 163C | 6305 32 00 | Flexible intermediate bulk containers”. |
2. This notification shall come into force on the 1st day of January, 2020.
(Gunjan Kumar Verma)
Under Secretary to the
Government of India
Note: - The principal notification No.1/2017-Central Tax (Rate), dated the 28th June, 2017 was published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 673(E), dated the 28th June, 2017 and was last amended by notification No. 14/2019- Central Tax(Rate), dated the 30th September, 2019, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number GSR 709(E), dated the 30th September, 2019.
📚 Frequently Asked Questions (FAQs): Notification No. 27/2019 - Central Tax (Rate)
Q1: What is Notification No. 27/2019 – Central Tax (Rate)?
Answer:
Notification No. 27/2019 – Central Tax (Rate) amends Notification No. 01/2017 to revise GST rates on specific goods, mainly woven/non-woven plastic bags and FIBCs, as per the 38th GST Council Meeting.
Q2: From which date is Notification No. 27/2019 applicable?
Answer:
The notification is effective from 1 January 2020. Supplies made on or after this date must follow the revised GST rates.
Q3: Which goods are affected by this notification?
Answer:
The key goods affected are:
Woven and non-woven bags or sacks of polyethylene or polypropylene strips
Flexible Intermediate Bulk Containers (FIBCs)
These are widely used for cement, fertilisers, grains, chemicals, and industrial packing.
Q4: What is the GST rate on woven and non-woven bags after this change?
Answer:
GST increased from 12% (6% CGST + 6% SGST) to 18% (9% CGST + 9% SGST) from 1 January 2020.
Q5: Why did the GST Council increase the GST rate on these goods?
Answer:
The GST Council aimed to:
Remove inverted duty structures
Bring parity between packaging materials
Reduce classification disputes
This aligns packaging goods with similar plastic products taxed at 18%.
Q6: What are FIBCs and why are they important?
Answer:
Flexible Intermediate Bulk Containers (FIBCs) are large industrial bags used for bulk transport of goods like cement, sugar, fertilisers, and minerals. The rate hike directly affects industrial packaging costs.
Q7: How does this change impact manufacturers?
Answer:
Manufacturers must:
Update product pricing
Revise GST rate in accounting systems
Communicate changes to buyers
👉 Need compliance help? Consult a Finodha GST Expert today!
🔗 https://finodha.in/gst-compliance/
Q8: What should traders and dealers do after this notification?
Answer:
Traders should:
Charge GST at 18% on relevant goods
Update HSN classification correctly
Ensure GSTR-1 and GSTR-3B reflect revised rates
👉 File accurate returns with Finodha:
🔗 https://finodha.in/gst-return-filing/
Q9: Does this change affect MSMEs?
Answer:
Yes. Many MSMEs involved in bag manufacturing and packaging are impacted. They must re-evaluate pricing and working capital.
👉 Register or update MSME/Udyam details with Finodha:
🔗 https://finodha.in/online-udyam-udyog-aadhar-msme-registration/
Q10: Is Input Tax Credit (ITC) still available at 18% GST?
Answer:
Yes ✅. Full ITC is available subject to Section 16 of the CGST Act, provided goods are used for taxable supplies and other ITC conditions are met.
Q11: How should these goods be reported in GST returns?
Answer:
They must be:
Reported with correct HSN (3923 / 6305)
Taxed at 18%
Reflected accurately in GSTR-1 and GSTR-3B
Q12: Does this notification affect exports?
Answer:
Indirectly, yes. While exports are zero-rated, higher GST on inputs may impact working capital and refund cycles.
👉 Smoothen refunds and compliance with Finodha:
🔗 https://finodha.in/gst-compliance/
Q13: What happens if old GST rate is charged after 1 Jan 2020?
Answer:
Charging old rates may lead to:
Short payment of GST
Interest under Section 50
Penalty under Sections 73 or 74
Q14: Does this amendment apply uniformly across India?
Answer:
Yes. Being issued under the CGST Act, it applies uniformly across all States and UTs.
Q15: Who should carefully review Notification No. 27/2019?
Answer:
This notification is crucial for:
Packaging material manufacturers
Cement & fertiliser bag suppliers
Exporters using FIBCs
Traders & distributors
👉 Need expert review? Get help from Finodha GST Professionals:
🔗 https://finodha.in/gst-compliance/
Conclusion✅:
Notification No. 27/2019 – Central Tax (Rate) may cover limited products, but it has a significant cost and compliance impact. Businesses must ensure correct rate application, pricing updates, and return compliance from 1 January 2020 onwards.
📌 Key takeaway:
Wrong GST rate = interest + penalty + disputes.
👉 Stay compliant and audit-ready with Finodha GST Experts
🔗 https://finodha.in/gst-compliance/
Download PDF: Notification No. 27/2019 - Central Tax (Rate)
More Information: https://taxinformation.cbic.gov.in/
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