{"id":865,"date":"2026-08-07T00:04:12","date_gmt":"2026-08-06T18:34:12","guid":{"rendered":"https:\/\/www.taxaj.com/learn\/gst-applicability-tax-rates-on-fashion-and-apparel\/"},"modified":"2026-10-14T11:38:41","modified_gmt":"2026-10-14T06:08:41","slug":"gst-applicability-tax-rates-on-fashion-and-apparel","status":"publish","type":"post","link":"https:\/\/www.taxaj.com/learn\/gst-applicability-tax-rates-on-fashion-and-apparel\/","title":{"rendered":"GST on Fashion & Apparel \u2014 Rates for Garments, Fabrics & Footwear"},"content":{"rendered":"

The fashion and apparel<\/strong> industry \u2014 fabrics, garments, footwear and accessories \u2014 has GST rates that often depend on the price\/value of the item<\/strong>, which makes classification important for manufacturers, wholesalers and retailers. This guide explains how GST applies to fashion and apparel. (Rates are periodically revised \u2014 confirm the current position for your product’s HSN.)<\/p>\n

GST on garments & apparel<\/h2>\n

Readymade garments and apparel have historically been taxed on a value-based structure<\/strong> \u2014 a lower rate for items up to a specified price per piece and a higher rate above that threshold. This price-linked approach means the same type of garment can attract different rates depending on its sale value, so retailers must map each SKU to the correct rate.<\/p>\n

Fabrics, footwear & accessories<\/h2>\n
    \n
  • Fabrics<\/strong> \u2014 generally taxed at a lower rate.<\/li>\n
  • Footwear<\/strong> \u2014 also historically value-linked, with a lower rate up to a price threshold and a higher rate above it.<\/li>\n
  • Accessories & branded goods<\/strong> \u2014 rates vary by classification; branded\/luxury items may sit at a higher slab.<\/li>\n<\/ul>\n

    Inverted duty structure<\/h2>\n

    The textile chain has sometimes faced an inverted duty structure<\/strong> \u2014 inputs taxed at a higher rate than the finished product \u2014 which can lead to accumulated input tax credit. Where applicable, businesses may claim a refund of accumulated ITC<\/strong> under the inverted-duty provisions, subject to conditions.<\/p>\n

    Compliance essentials<\/h2>\n
      \n
    • Map each product to the correct HSN and rate<\/strong>, including value-based thresholds.<\/li>\n
    • Track ITC<\/strong> and evaluate inverted-duty refund eligibility.<\/li>\n
    • E-invoicing\/e-way bills<\/strong> where applicable by turnover and movement.<\/li>\n<\/ul>\n

      Frequently asked questions<\/h2>\n

      Is GST on apparel based on price?<\/h3>\n

      Yes \u2014 readymade garments (and footwear) have historically used a value-based<\/strong> structure, with a lower rate up to a price threshold and a higher rate above it. Confirm the current thresholds.<\/p>\n

      What rate applies to fabrics?<\/h3>\n

      Fabrics are generally taxed at a lower rate<\/strong>; confirm the current rate for your specific fabric HSN.<\/p>\n

      Can textile businesses get an ITC refund?<\/h3>\n

      Where an inverted duty structure<\/strong> applies, a refund of accumulated input tax credit may be available, subject to conditions.<\/p>\n

      \n

      In fashion, textiles or footwear?<\/strong> TAXAJ handles GST classification, inverted-duty refunds and returns. Get GST support from TAXAJ \u2192<\/strong><\/a><\/p>\n

      Related guides:<\/em> GST registration<\/a> \u00b7 Input tax credit<\/a> \u00b7 GST returns<\/a><\/p>\n