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Understand GST Exemption

What is a GST exemption?

What is an exempt supply under GST?

There are three types of supplies that can enjoy exemption under GST. They are as follows:

  • Supplies taxable at 0% tax or nil tax rate. 
  • Whole or partial exemption of supplies under CGST or SGST. 
  • Supplies under Section 2(78) ( Non taxable supply)

Note: One cannot utilise the input tax credit applicable to these supplies.

In addition to this, one must follow the list mentioned below to understand the differences between nil-rated, zero-rated, exempt and non-GST supplies.

Supplies

Meaning

Nil-rated

Supplies that have 0% tax rate. Example: Salt.

Non-GST

Ones that do not come under the purview of GST law include alcohol for human consumption.

Zero-rated

Export supplies to SEZ (Special Economic Zone) developers.

Exempt

Taxable supplies that do not attract GST. Curd, fruits are among some of the supplies.

Furthermore, there are different types of GST exemptions one needs to know about.

Types of exemption in GST

List of GST exemption

Reasons for exemption under GST

Frequently Asked Questions