GST on Transportation Services
Goods Transport Agency (GTA) — Road Freight
A Goods Transport Agency (GTA) is any person who provides a goods transport service by road and issues a consignment note. GTAs are the most common form of freight movement in India and have a special GST treatment:
| GTA Tax Option | GST Rate | Who Pays | ITC Available? |
|---|---|---|---|
| Reverse Charge Mechanism (default) | 5% | Recipient pays to govt | Recipient can claim ITC |
| Forward Charge (GTA opts in) | 5% | GTA pays to govt | No ITC for GTA |
| Forward Charge (GTA opts in) | 12% | GTA pays to govt | Yes, GTA can claim ITC |
RCM applies when: The recipient is a factory, registered dealer, body corporate, partnership firm, co-operative society, or any person registered under GST.
GTA services exempt from GST: Transport of agricultural produce; milk, salt, food grains; newspaper; relief materials; defence goods; household goods by an individual.
Non-GTA Road Transport
Transport of goods by road by a person who is not a GTA (i.e., does not issue a consignment note) — for example, a truck owner directly hired without any consignment note — is exempt from GST.
GST Rates — All Transport Modes
| Transport Type | GST Rate | Notes |
|---|---|---|
| GTA road freight (RCM) | 5% | Paid by registered recipient |
| GTA road freight (forward, no ITC) | 5% | GTA pays directly |
| GTA road freight (forward, with ITC) | 12% | GTA pays; ITC claimable |
| Non-GTA road transport | Exempt | No consignment note issued |
| Domestic air — economy class | 5% | On base ticket fare |
| Domestic air — business class | 12% | On base ticket fare |
| International air (all classes) | Exempt | — |
| Rail — AC classes & First class | 5% | Passengers; freight is 5% |
| Rail — Non-AC / Sleeper | Exempt | — |
| Metro / monorail | Exempt | — |
| Auto-rickshaw (passenger) | Exempt | Including app-based autos |
| Cab aggregators (Ola, Uber) | 5% | No ITC for recipient; Section 9(5) |
| Rented vehicle / cab (non-aggregator) | 5% | — |
| AC bus (contract carriage) | 5% | — |
| Non-AC bus / ordinary bus | Exempt | — |
| Inland waterway transport | 5% | — |
| Courier / express delivery | 18% | BlueDart, Delhivery, DTDC, etc. |
| Pipeline transport (oil/gas) | 18% | — |
Passenger Transport — Cab Aggregators (Ola, Uber)
Under Section 9(5) of the CGST Act, cab aggregator companies (Ola, Uber, Rapido, etc.) are liable to pay GST on passenger transport services booked through their apps, even though the ride is provided by individual driver-partners. The applicable rate is 5% GST with no ITC. The driver-partner is not separately registered or liable for GST on these rides.
ITC on Transportation Expenses
Businesses can generally claim ITC on GST paid on transportation of goods used for business. However, ITC on passenger transport (cab hire, air tickets) is blocked under Section 17(5) — it cannot be claimed, even when travelling for business purposes. The only exception is when transportation of persons is itself the business (e.g., a tour operator).
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