Fertilisers Under GST explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Headings 3102 and 3103 appear twice in the rate notification — once in the 5% schedule and once in the 18% schedule. The only thing separating them is the phrase "clearly not to be used as fertilizers", and a 2018 circular had to be issued because that phrase was being read to catch fertilisers that plainly were.
Fertilisers of headings 3102, 3103, 3104 and 3105, "other than those which are clearly not to be used as fertilizers", attract 5%. The same headings, where the goods are clearly not to be used as fertilisers, attract 18%. Circular No. 54/28/2018-GST dated 09.08.2018 clarifies that fertilisers "supplied for direct use as fertilizers, or supplied for use in the manufacturing of other complex fertilizers for agricultural use (soil or crop fertilizers), will attract 5% IGST."
The question the circular answered
The doubt was narrow and commercially large: "Whether simple fertilizers, such as MOP (Murate of Potash) classified under Chapter 31, and supplied for use in manufacturing of a complex fertilizer, are entitled to the concessional GST rate of 5%, as applicable in general to fertilizers."
The argument for 18% ran like this. MOP delivered to a fertiliser factory is not going onto a field; it is a manufacturing input. So, the argument went, it is "clearly not to be used as fertilizer" in the hands of that buyer.
The Board rejected it, and explained why the phrase exists at all.
"In the GST regime, tax structure on fertilizers has been prescribed on the lines of pre-GST tax incidence. The wording of the GST notification is similar to the central excise notification except certain changes to meet the requirements of GST. These changes were necessitated as GST is applicable on the supply of goods while central excise duty was applicable on manufacture of goods."
And then the operative holding:
"The intention has been to provide concessional rate of GST to the fertilizers which are used directly as fertilizers or which are used in the manufacturing of complex fertilizers which are further used as soil or crop fertilizers. The phrase 'other than clearly to be used as fertilizers' would not cover such fertilizers that are used for making complex fertilizers for use as soil or crop fertilizers."
What the phrase actually excludes
Read with the circular, "clearly not to be used as fertilizers" is aimed at goods of Chapter 31 destined for a non-fertiliser end use altogether — industrial chemical applications, explosives manufacture, and the like — not at intermediate use within the fertiliser chain.
| Supply of a Chapter 31 fertiliser | Rate |
|---|---|
| To a farmer or dealer, for direct application | 5% |
| To a fertiliser manufacturer, to make a complex fertiliser for soil or crop use | 5% — Circular No. 54/28/2018 |
| For an end use that is clearly not fertiliser | 18% |
The circular's reference points are "S. No. 182A to 182D of the First schedule" for the 5% entries and "S. No. 42 to 45 of the III schedule" for the 18% entries of the then Notification No. 1/2017-CT(Rate) — now Notification No. 09/2025-CT(Rate) dated 17.09.2025, which superseded it. The structure carried across; the serial numbers must be read in the current schedule. The 2025 rate notifications →
The evidentiary problem, and how it is managed
The rate depends on end use, and the supplier does not control the end use. That is unusual in GST, where classification is normally intrinsic to the goods.
Three practical consequences follow.
The word "clearly" sets the burden. The default is 5%; the 18% entry applies only where the non-fertiliser use is clear. A supplier is not required to prove the fertiliser use — the department must establish the contrary.
Declarations are the ordinary mechanism. A buyer's declaration of intended use, recorded against the supply, is what a supplier keeps. It does not bind the department, but it evidences the basis on which the rate was charged.
And a change of use downstream does not retrospectively change the supply's rate. The rate is fixed by the character of the supply when made.
Organic and animal fertilisers: a different switch
Heading 3101 — "All goods i.e. animal or vegetable fertilisers or organic fertilisers" — is at 5% where pre-packaged and labelled.
The condition here is packaging, not end use. Unpackaged or unlabelled organic manure sits on the exempt side; the same manure in a labelled bag is at 5%.
And note the separate service exemption. Transportation of organic manure by rail or vessel is exempt under entry 20(g) of Notification No. 12/2017-CT(Rate), and by a GTA under entry 21 — regardless of whether the manure itself is at nil or 5%. Transport of goods exemptions →
Pesticides, and why they are not treated alike
Pesticides and agrochemicals are classified in Chapters 28, 29 and 31 "depending on their chemical characteristics and composition", and — unlike fertilisers — carry no equivalent concessional structure keyed to agricultural use.
This is a standing complaint of the sector, and it produces the inverted duty problem: a farmer's inputs at 18% feeding into produce that is exempt or at 5%, with no credit available on the exempt side. ITC reversal where output is exempt →
Key takeaways
- Fertilisers of 3102, 3103, 3104 and 3105 are at 5% "other than those which are clearly not to be used as fertilizers", which are at 18%.
- Circular No. 54/28/2018-GST holds that fertilisers supplied for making complex fertilisers for soil or crop use remain at 5%.
- The phrase was carried over from the central excise notification and adapted because GST taxes supply, not manufacture.
- The word "clearly" places the burden on the revenue to establish a non-fertiliser end use.
- Heading 3101 organic and animal fertilisers are at 5% when pre-packaged and labelled.
- Transport of organic manure is exempt under entries 20(g) and 21 of Notification No. 12/2017-CT(R) regardless of the goods rate.
- Pesticides have no equivalent concession, which is a principal source of inverted duty in the sector.
- The serial numbers cited in the 2018 circular must now be read in Notification No. 09/2025-CT(Rate).
Read next
- GST Rates on Agricultural Goods After Notification No. 9/2025
- Classification of Agricultural Goods and Services: HSN and SAC
- ITC Reversal in a Rice Mill: Rule 42, Worked Through
Disclaimer: Positions stated as on 5 September 2026, based on Circular No. 54/28/2018-GST dated 9 August 2018, Chapter 31 of the Customs Tariff Act, 1975, Notification No. 09/2025-Central Tax (Rate) dated 17 September 2025 (superseding Notification No. 1/2017-CT(Rate)) and entries 20 and 21 of Notification No. 12/2017-Central Tax (Rate), as reproduced in the ICAI Handbook on Applicability of GST on Agricultural Sector (January 2026, law updated to 31 December 2025).