Imported goods attract IGST in addition to Basic Customs Duty (BCD). IGST = applicable GST rate × (CIF value + BCD + social welfare surcharge), levied under Section 3(7) of the Customs Tariff Act. A GST-registered importer can claim 100% Input Tax Credit of the IGST paid at customs — but BCD and surcharge are never creditable. Imported services are taxed at 18% under Reverse Charge (RCM), paid by the Indian recipient.
How Import Tax Is Calculated — ₹1,00,000 CIF
IGST is not charged on the goods value alone — it is charged on the assessable value plus customs duties. Here is the standard build-up for a ₹1 lakh consignment with 10% BCD and 18% IGST.
| Component | Basis | Amount |
|---|---|---|
| CIF value (assessable) | Cost + Insurance + Freight | ₹1,00,000 |
| Basic Customs Duty (BCD) | 10% × CIF | ₹10,000 |
| Social Welfare Surcharge | 10% × BCD | ₹1,000 |
| IGST base | CIF + BCD + SWS | ₹1,11,000 |
| IGST @ 18% | 18% × IGST base | ₹19,980 |
| Total customs + tax | BCD + SWS + IGST | ₹30,980 |
| Landed cost | CIF + total duty | ₹1,30,980 |
Only the ₹19,980 IGST is creditable for a registered business. BCD (₹10,000) and SWS (₹1,000) are costs. Some goods also carry a compensation cess.
Registered business importer
Personal / unregistered importer
The single most missed point on imports: only IGST paid at customs is available as Input Tax Credit. Basic Customs Duty, Social Welfare Surcharge and any anti-dumping/safeguard duty are not creditable and become part of your landed cost — so factor them into pricing separately.
IGST Rates on Common Imported Goods
Import IGST follows the same rate the good would attract if supplied within India, under the GST 2.0 two-slab structure effective 22 September 2025. Classification is by HSN code.
| Imported item | BCD (indicative) | IGST | ITC (business use) |
|---|---|---|---|
| Capital machinery / industrial plant | 5-7.5% | 18% | Yes |
| Electronic components / parts | 0-10% | 18% | Yes |
| Laptops & computers | 0% | 18% | Yes |
| Mobile phones | 15-20% | 18% | Yes (stock) |
| Many mass-use goods / essentials | 0-10% | 5% | Yes |
| Gold (bullion / jewellery) | Per notification | 3% | No* |
| Life-saving / listed medicines | 0% | Nil-5% | Yes |
| Crude petroleum | Varies | Outside GST | No |
Mobile phones moved from 12% to 18% under GST 2.0. Rates are indicative — always confirm the current IGST rate and HSN on the official portal. *Gold ITC turns on whether your onward supply is taxable/exempt.
Not sure of the correct HSN and IGST rate for your imports?
Get a Classification Check →
ITC on IGST Paid at Import
A GST-registered importer can take full Input Tax Credit of the IGST paid on the bill of entry, subject to the normal ITC conditions. The credit auto-populates in GSTR-2B from the ICEGATE customs data linked to your GSTIN.
- 1ImportGoods cleared on a bill of entry
- 2Pay IGSTIGST paid at customs (ICEGATE)
- 3GSTR-2BIGST auto-reflects against your GSTIN
- 4Claim ITCSet off against output GST
✓IGST credit is available when
- You are GST-registered with a valid GSTIN on the bill of entry
- Goods are imported for business use / furtherance of business
- The bill of entry shows in your GSTR-2B
- You are not making only exempt onward supplies
!No / restricted credit when
- You are unregistered or importing for personal use
- Goods are used for exempt or non-business supplies
- Item falls under blocked credit (Section 17(5))
- Only BCD / surcharge is paid — these are never creditable
Reconcile every bill of entry against your GSTR-2B each month. Mismatches between what you paid on ICEGATE and what appears against your GSTIN are the most common reason importers lose otherwise-valid IGST credit.
Import-heavy business? Get your bill-of-entry ITC reconciled with your returns.
Get Import ITC Help →GST on Imported Services — Reverse Charge
Services bought from a foreign supplier (import of services) are taxed under the Reverse Charge Mechanism: the Indian recipient self-pays 18% IGST and, if registered for business use, claims it back as ITC in the same period.
| Imported service | IGST | Who pays | ITC |
|---|---|---|---|
| Cloud / SaaS (AWS, Azure, Google) | 18% | Indian recipient (RCM) | Yes |
| Software licences (Microsoft, Adobe) | 18% | Indian recipient (RCM) | Yes |
| Foreign consulting / management fees | 18% | Indian recipient (RCM) | Yes |
| Royalties to foreign entities | 18% | Indian recipient (RCM) | Yes |
| Online advertising (Google, Meta) | 18% | Indian advertiser (RCM) | Yes |
RCM on imported services applies even where the recipient would otherwise be below the registration threshold for that supply.
GST on Personal & Online Imports
Buying from Amazon US, eBay or AliExpress? Imports for personal use still attract BCD + IGST, but you cannot claim ITC because you are not registered / not using them for business.
- Gifts up to ₹5,000 CIF received from abroad are generally duty-free; above that, normal duty + IGST applies.
- Personal courier imports carry BCD + IGST on the assessable value; small low-value parcels often clear without duty in practice, but there is no formal de-minimis exemption.
- An unregistered person importing services above the threshold may still have to register and pay RCM IGST.
Because a personal importer is not GST-registered and is not using goods for business, the IGST paid at customs is a straight cost — it cannot be claimed as Input Tax Credit. Only registered businesses recover the IGST.
- IGST on imports: Section 3(7) & 3(8), Customs Tariff Act, 1975
- Charge & ITC: Section 5(1) IGST Act & Section 16, CGST Act 2017
- Rates & notifications: gst.gov.in
- Customs & GST 2.0 alignment: cbic-gst.gov.in · Notification 38/2025-Customs (eff. 22 Sep 2025)
Disclaimer: This guide is general information based on the law and notifications in force when it was last updated. It is not professional advice for your case — rates, thresholds and due dates change, so check the current position with the official source before you act on it.