Warehousing or storage of agricultural produce, and of rice, is exempt from GST under Notification 12/2017-CT(R). Warehousing of all other, processed or branded goods is taxable at 18% (SAC 9967 / 996729). Renting a warehouse building as commercial immovable property is 18% (forward charge). Once agri produce is processed or branded, its storage becomes 18%.
GST on Warehousing — Decision Table
Every common warehousing and storage scenario, with the GST rate, SAC code and whether Input Tax Credit is available.
| Type of Supply | GST Rate | SAC | ITC |
|---|---|---|---|
| Agricultural produce (raw) — paddy, wheat, copra, jaggery, cotton | Exempt | 996729 | No |
| Rice — storage & warehousing | Exempt | 996729 | No |
| Cold storage of agricultural produce | Exempt | 996729 | No |
| Processed / branded goods warehousing | 18% | 9967 | Yes |
| General public / private warehouse | 18% | 9967 | Yes |
| E-commerce fulfilment / 3PL warehousing | 18% | 9967 | Yes |
| Cold storage — pharma / chemicals / processed food | 18% | 9967 | Yes |
| Value-added services (blast freezing, grading, packing) | 18% | 9985 | Yes |
| Renting a warehouse building (commercial property) | 18% | 997212 | Yes |
| Landlord / operator turnover < ₹20L | Nil | — | — |
SAC 9967 / 996729 (storage & warehousing support services). Rates reflect the GST 2.0 two-slab structure effective 22 September 2025 — warehousing rules were not changed. Confirm on the official GST portal before invoicing.
Exempt Storage vs 18% Warehousing
One factor decides it: what is being stored. Storage of raw agricultural produce (and rice) is exempt; storage of every other, processed or manufactured commodity is taxed at 18%.
Agri produce & rice — no GST
- Raw agricultural produce — paddy, wheat, copra, jaggery, cotton
- Rice storage & warehousing
- Cold storage of unprocessed fruits, vegetables, milk
- Refrigerated transport of agri goods
- No ITC — these are exempt supplies
Other goods warehousing — with ITC
- Processed, branded & manufactured goods
- General public and private warehouses
- E-commerce fulfilment centres & 3PL
- Cold storage of pharma, chemicals, processed food
- Full ITC on operational inputs available
Not sure whether your storage service is exempt or taxable at 18%?
Get My GST Position →Agricultural Produce — What Stays Exempt?
The exemption is strict: it covers produce that is raw or only minimally processed (the processing normally done by a cultivator to make it marketable). Once the commodity is processed, refined or branded, its warehousing becomes taxable at 18%.
| Commodity | Storage | Notes |
|---|---|---|
| Paddy / rough rice | Exempt | Rice storage is also exempt |
| Wheat (raw grain) | Exempt | Flour / maida — processed, 18% |
| Copra, jaggery, raw sugarcane | Exempt | Refined sugar — 18% |
| Cotton (raw fibre) | Exempt | Yarn / fabric — 18% |
| Fruits & vegetables (unprocessed) | Exempt | Packaged / processed versions 18% |
| Tobacco leaves (unmanufactured) | Exempt | Manufactured tobacco 18% |
| Milk (raw, unprocessed) | Exempt | Packaged dairy products 18% |
GST 2.0 (22 September 2025) did not change this boundary. Verify borderline commodities on gst.gov.in.
Claiming exemption on storage of processed goods, or on a warehouse that stores both agri produce and manufactured goods, is a frequent trigger for GST department notices. Mixed-use operators must segregate records and invoices and apportion ITC under Rule 42/43.
Warehouse Building Rent vs Storage Service
These are treated differently. Letting out the warehouse building as immovable commercial property is a renting-of-property supply at 18% (forward charge). Providing a storage/warehousing service (you keep the goods and manage them) is a support service — 18% for general goods, exempt for agri produce.
Renting the warehouse building
- Tenant takes the building on lease
- Commercial immovable property — SAC 997212
- Landlord charges 18% under forward charge
- Registered tenant can claim full ITC
- No RCM — that applies only to residential lets
Providing a storage service
- Operator keeps & manages the goods
- General / processed goods — 18% (SAC 9967)
- Agri produce & rice — Exempt
- Handling, palletisation, labelling add to 18%
- ITC available only on the taxable part
Letting out a warehouse or running a storage business? Get the right classification.
Talk to a GST Expert →ITC and Registration for Warehouse Operators
Registration becomes mandatory once aggregate turnover crosses ₹20 lakh (₹10 lakh in special-category states). A warehouse operator making only exempt agri-storage supplies need not register, and cannot claim any ITC.
| Input | ITC? | Reason |
|---|---|---|
| Racking, forklifts, conveyors, handling equipment | Yes | Movable business assets — normal ITC |
| Machinery, IT / WMS systems, security, maintenance | Yes | Used for taxable warehousing service |
| Works contract to construct the warehouse building | No | Blocked — Section 17(5)(c)/(d), immovable property |
| Inputs used for exempt agri storage | No | Exempt supply — no ITC |
| Mixed taxable + exempt storage | Part | Apportion under Rule 42/43, CGST Rules |
Detachable fixtures (racking, mezzanine, removable conveyors) may qualify; capitalised civil construction does not.
The biggest ITC leakage for a warehouse is the construction bill — works-contract GST on the building itself is blocked. Structure the capex so that eligible movable equipment is invoiced separately from the immovable civil works to preserve the credit you are entitled to.
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