GST on Warehousing Services in India (2026)

No, GST is NOT applicable on the storage or warehousing of agricultural produce. This exemption is specifically listed under Notification No. 12/2017-CT (Rate) and covers paddy, wheat, copra, sugarcane, jaggery, raw vegetable fibres, tobacco leaves, cotton, and other agricultural produce in unprocessed or minimally processed form. The SAC code for these exempt services is 996729. The rationale is to prevent cascading costs in the farm-to-market supply chain and keep food affordable. Cold storage services for agricultural produce are also exempt, provided the facility is used for the storage of agri goods and not for other manufactured or processed items. However, the exemption is strictly limited to raw agricultural produce — if the commodity has been processed, refined, or manufactured (e.g., rice from paddy, refined sugar from sugarcane), the warehousing of the processed output may attract GST. Operators of mixed-use warehouses — storing both agri produce and manufactured goods — must maintain clear segregation in their records and invoices to apply the correct tax treatment. Claiming exemption on warehousing of processed goods is a common compliance error that leads to GST department notices.

Warehousing or storage services for manufactured goods, industrial inputs, consumer goods, and other non-agricultural commodities attract GST at 18% under SAC code 9967 (Support services in transport) or SAC 9985 (Support services). This covers general public warehouses, private warehousing companies, logistics warehouses, e-commerce fulfilment centres, third-party logistics (3PL) providers, and bonded warehouses (except for SEZ operations). The 18% rate applies to the core storage fee as well as ancillary charges billed by the warehouse operator — handling charges, palletisation, labelling, inventory management, and similar value-added services. E-commerce companies using fulfilment centres (such as Amazon FBA-style operations) pay 18% GST on the storage and fulfilment fees charged by the 3PL provider. Input Tax Credit (ITC) is fully available to warehouse operators on inputs such as construction materials used for business-related warehouse construction, machinery, packing materials, electricity connections for industrial use, and services procured for warehouse operation — subject to normal ITC eligibility conditions and the block credit restrictions under Section 17(5).

No, warehousing services provided within a Special Economic Zone (SEZ) unit or to an SEZ developer are zero-rated under the IGST Act, 2017. Zero-rating means GST is effectively 0% on such supplies, and the supplier can claim a refund of accumulated Input Tax Credit on inputs used for these services. Services provided BY an SEZ unit to another SEZ unit or to an SEZ developer also qualify for zero-rating. However, warehousing services provided to a non-SEZ entity using a warehouse physically located outside the SEZ — even if the warehouse is adjacent to or near the SEZ — does not qualify for zero-rating and is taxed at 18%. Export warehouses where goods are stored before export are effectively zero-rated because the ultimate supply (export) is zero-rated, and the warehousing service cost is part of the export supply chain. Businesses operating bonded warehouses licensed under the Customs Act for imported goods may operate under a customs-supervised regime, but any GST on service fees for managing the bonded warehouse from a third party is payable at 18% unless the warehouse is within an SEZ or serving an export-oriented unit with zero-rated status.

Yes, warehouse operators who are registered under GST and provide taxable warehousing services (18% GST) can claim Input Tax Credit on most business inputs. Eligible ITC includes: GST paid on machinery, racking systems, forklifts, material-handling equipment, security systems, IT systems for warehouse management, electricity connections for industrial use, repair and maintenance services, and professional services. However, there is an important restriction under Section 17(5) — ITC is blocked on works contract services for construction of an immovable property (i.e., the warehouse building itself), and on goods and services used for construction of the warehouse that are capitalised as immovable property. This means building a new warehouse using contractors does not yield ITC on the construction bills. However, items that are movable fixtures — racking, mezzanine floors, conveyor systems that can be detached — may qualify for ITC. Agricultural produce warehouse operators who are exempt from GST cannot claim any ITC at all, since they make only exempt supplies. Mixed-use operators must apportion ITC between taxable and exempt activities using the formula prescribed in Rule 42 and 43 of CGST Rules.

The GST treatment of cool chain logistics depends on what is being stored and whether the service is pure storage or includes value-added components. Cold storage of agricultural produce (fruits, vegetables, milk, eggs in unprocessed form) is EXEMPT from GST, as these fall under the agricultural produce exemption under Notification 12/2017-CT (Rate). Refrigerated transport of agricultural produce is also exempt under the transport exemption for agricultural goods. However, cold storage of non-agri processed foods — packaged ready-to-eat meals, frozen processed meats, dairy-based confectionery, pharmaceutical products, chemicals — attracts 18% GST. If a cold storage facility provides services beyond pure storage — such as blast freezing, controlled atmosphere storage management, packaging, grading, sorting — and these services are billed separately, they may attract 18% GST even for agri produce, as they cross the threshold from mere storage to supply of services. Integrated cold chain logistics service providers who offer transport, warehousing, processing, and distribution as a composite supply must evaluate whether the principal supply is storage (potentially exempt) or a taxable service. GST authorities have litigated this issue, and operators should seek a formal advance ruling for mixed services.