GST on road freight confuses people because the answer depends on three things at once: whether the transporter issues a consignment note, who the customer is, and which option the transporter has chosen. This guide sets them out in order.
1. Who is a goods transport agency?
A goods transport agency (GTA) is any person who provides a service in relation to transport of goods by road and issues a consignment note, by whatever name called. The lorry receipt or bilty is that note.
Transport of goods by road by someone who is neither a GTA nor a courier agency — for example, a truck owner who simply hires out the vehicle and issues no consignment note — is generally exempt from GST. So the first question is whether a bilty is issued.
2. The two options from 22 September 2025
The 56th GST Council meeting removed the 12% slab. For a GTA that leaves two options:
| Option | Rate | Input tax credit for the GTA | Who pays the tax |
|---|---|---|---|
| Without credit | 5% | Not available | Usually the recipient under reverse charge; the GTA if it has opted for forward charge |
| With credit | 18% | Available | The GTA, under forward charge |
Before that date the “with credit” option was 12%. A GTA chooses forward charge by filing the prescribed declaration for the financial year, and the choice then applies to all its supplies for that year.
3. Reverse charge: when the customer pays
Where the GTA has not opted for forward charge, GST is paid by the recipient under the reverse charge mechanism (RCM) when the person liable for the freight is one of the specified categories. These include a factory, a society, a co-operative society, a person registered under GST, a body corporate, a partnership firm and a casual taxable person. In that case the transporter’s bill shows no GST and says that tax is payable by the recipient.
A GTA all of whose supplies fall under reverse charge is not required to register under GST only on account of those supplies.
4. Common exemptions
GTA services are exempt when they involve, among other things:
- agricultural produce;
- milk, salt and food grains including flour, pulses and rice;
- organic manure;
- newspapers and magazines registered with the Registrar of Newspapers;
- relief materials for victims of disasters;
- defence or military equipment;
- goods where the freight for everything carried in a single carriage does not exceed ₹1,500;
- goods where the freight for all goods for a single consignee does not exceed ₹750.
5. What this means for your bill
- Reverse charge: no tax line. State that GST is payable by the recipient under RCM and print the recipient’s GSTIN.
- Forward charge: add CGST and SGST for a supply within the state, or IGST for a supply to another state, at 5% or 18% as you have opted. The document is a tax invoice.
- Exempt: no tax line.
The transport bill tool prints any of the three. It does not decide which one applies to you.
This guide is general information for transporters, not tax or legal advice. Rules and rates change by notification; confirm the current position with your accountant or the official sources below before acting on it.
Sources
- GST Council, FAQs on the decisions of the 56th meeting (September 2025) — gstcouncil.gov.in
- Central Board of Indirect Taxes and Customs, GST notifications and rules — cbic-gst.gov.in