Job Work Rates Under HSN 9988, and the Place of Supply

Job Work Rates Under 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.

Job work has one of the longest rate entries in the services schedule, and for a simple reason: the rate follows the goods being worked on, not the work being done. The same machining operation is taxed differently depending on whether the part is a diamond, a textile or an engine casting.

Job work services fall under HSN 9988. The Handbook, updated to 31 May 2026, sets out three CGST bands: 0.75% for job work relating to diamonds of Chapter 71; 2.50% for a long list including food products (Chapters 1–22), pharmaceuticals (Chapter 30), hides, skins and leather (Chapter 41), textiles (Chapters 50–63), printing, handicraft goods, umbrellas and tailoring; and 9.00% for job work in relation to manufacture of alcoholic liquor for human consumption and for all other job work. The current entry rests on Notification No. 15/2025-Central Tax (Rate) dated 17.09.2025 and its IGST counterpart.

The three bands

CGST 0.75% (1.5% total) — services by way of job work relating to:

• diamonds falling under Chapter 71 of the First Schedule to the Customs Tariff Act, 1975.

CGST 2.50% (5% total) — services by way of job work relating to:

• all food and food products falling under Chapters 1 to 22;
• all products under Chapter 23, except dog and cat food of heading 2309;
• goods under Chapter 30 — pharmaceutical products;
• hides, skins and leather under Chapter 41 — "Provided that nothing contained in clause (d) shall apply to job-work in relation to leather goods or footwear falling under Chapter 42 or 64";
• printing of newspapers, books (including Braille books), journals and periodicals;
• printing of all goods under Chapters 48 or 49 which attract central tax at 2.5% or Nil;
• textiles and textile products under Chapters 50 to 63;
• bricks under Chapters 68 or 69 which attract central tax at 2.5%;
• all products other than diamonds under Chapter 71;
• handicraft goods;
• umbrellas;
• services by way of any treatment or process on goods belonging to another person, in relation to printing of the publications and Chapter 48/49 goods above, and tailoring services.

CGST 9.00% (18% total) — services by way of job work relating to:

• manufacture of alcoholic liquor for human consumption;
• job work other than the two bands above; and
• any treatment or process on goods belonging to another person, other than the above.

The leather proviso is the sort of detail that decides an assessment. Working on hides, skins and leather is in the 5% band; working on leather goods or footwear made from them is not — it falls to the residual 18%.

And the alcoholic liquor entry is deliberate. Alcoholic liquor for human consumption is outside GST as goods, but the job work service of manufacturing it is inside GST, expressly at the higher rate.

The notification trail

The Handbook records the full chain, which is worth keeping because the entry has been amended repeatedly.

On the CGST side — entry 26 of Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017, read with Notification No. 20/2017-CT(R) dated 22.08.2017; 31/2017-CT(R) dated 13.10.2017; 46/2017-CT(R) dated 14.11.2017; 1/2018-CT(R) dated 25.01.2018; 20/2019-CT(R) dated 30.09.2019; 26/2019-CT(R) dated 22.11.2019; and Notification No. 15/2025-Central Tax (Rate) dated 17.09.2025.

On the IGST side — entry 26 of Notification No. 8/2017-Integrated Tax (Rate) dated 28.06.2017, read with the corresponding amendments and Notification No. 15/2025-Integrated Tax (Rate) dated 17.09.2025.

The 17 September 2025 notifications are the current layer, issued alongside the wider rate rationalisation effective 22 September 2025. The three bands as set out above are those the Handbook states as at 31 May 2026.

Ten circulars worth knowing about

The Handbook lists the CBIC circulars on job work and recommends reading them for the issues each addresses:

19/19/2017-GST (20.11.2017) · 38/12/2018-GST (26.03.2018) · 48/22/2018-GST (14.06.2018) · 52/26/2018-GST (09.08.2018) · 88/07/2019-GST (01.02.2019) · 126/46/2019-GST (22.11.2019) · 153/09/2021-GST (17.06.2021) · 164/20/2021-GST (16.10.2021) · 206/18/2023-GST (31.10.2023) · 208/02/2024-GST (26.06.2024).

Circular No. 38/12/2018 is the foundational one — it supplies the "facts and circumstances of each case" test, the job worker's own goods, the direct-despatch documentation, the registration position and the deemed supply mechanics, all of which recur through the job work chapters.

Place of supply: it follows the parties, not the goods

Job work charges are a service, and the Handbook fixes the provision: "So far as job work is concerned, supply for job work charges is governed by section 12(2) of IGST Act, 2017" — the general rule for services where both supplier and recipient are in India, which points to the location of the registered recipient.

So on the job work fee, a job worker in one State invoicing a principal registered in another charges IGST; within the same State, CGST and SGST.

On the goods sold from the job worker's premises, the rule is different and more counter-intuitive. Where the registered job worker and the principal are in different States and goods are removed directly from the job worker's place:

• "If the principal (supplier of the goods) and recipient (buyer of the goods) are in the same State, then SGST and CGST shall be levied, though the job worker is in a different State."
• "If the principal and recipient are in different States, then IGST shall be levied, even though the recipient is in the State where the job worker is situated."

The job worker's State is irrelevant to that supply. It is a supply between the principal and the customer; the job worker's premises are simply where the goods happen to start moving. Supplying from the job worker's premises →

Two supplies, two different rules, on the same consignment — the fee under section 12(2) by reference to the principal's registration, and the goods by reference to the principal and the customer.

Key takeaways

• Job work is classified under HSN 9988, and the rate follows the goods being worked on.
• 1.5% — diamonds of Chapter 71. 5% — food, Chapter 23 (except dog and cat food), pharmaceuticals, hides/skins/leather, printing of specified publications, textiles of Chapters 50–63, specified bricks, non-diamond Chapter 71, handicrafts, umbrellas and tailoring. 18% — alcoholic liquor manufacture and everything else.
• Leather goods and footwear (Chapters 42 and 64) are excluded from the 5% leather entry.
• Job work on alcoholic liquor for human consumption is expressly at 18%, though the goods are outside GST.
• The current entry rests on Notification No. 15/2025-CT(R) and 15/2025-IT(R), both dated 17.09.2025.
• Job work charges are a service with place of supply under section 12(2) of the IGST Act.
• Goods supplied from the job worker's premises follow the principal and the customer, not the job worker's State.
• Ten CBIC circulars address job work; Circular No. 38/12/2018 is the foundational one.

Read next

• Supplying Directly From the Job Worker's Premises
• Section 2(68): Job Work Needs a Registered Principal
• Waste and Scrap Generated During Job Work

Disclaimer: Positions stated as on 5 September 2026, based on entry 26 of Notification No. 11/2017-Central Tax (Rate) and Notification No. 8/2017-Integrated Tax (Rate), as amended up to Notification Nos. 15/2025-Central Tax (Rate) and 15/2025-Integrated Tax (Rate) dated 17 September 2025, and section 12(2) of the IGST Act, 2017, as reproduced in the ICAI Handbook on Job Work under GST (4th edition, June 2026, updated to 31 May 2026). Rate figures should be read against the rate notification in force on the date of the invoice.