Understanding HS Code For Vehicle
Vehicles are classified under the Harmonized System (HS) based on their type, fuel, and usage — such as passenger cars, trucks, electric vehicles, two-wheelers, and commercial vehicles. These HS codes determine the applicable custom duties, GST, and compensation cess in India for both import and domestic taxation purposes.
Vehicles fall under Chapter 87 – Vehicles Other Than Railway Or Tramway Rolling Stock. The key heading is:
HS Code 8703 – Motor cars and other motor vehicles principally designed for the transport of persons.
Importance Of HS Code For Vehicle
Accurate HS classification for vehicles is important for:
- Correct Custom Duty & GST: Ensures proper taxation and avoids overpayment.
- Regulatory Compliance: Required for registration and import approvals.
- Incentives & Exemptions: Used for export and FTA-related duty claims.
- Logistics & Inventory: Helps identify vehicle categories in ERP and customs systems.
HS Code Classification For Vehicle
Vehicles are classified under different HS codes based on type, engine capacity, and purpose:
- 870110 – Tractors
- 870210 – Public transport buses
- 870321 – Petrol cars ≤1000 cc
- 870322 – Petrol cars >1000 cc to ≤1500 cc
- 870323 – Petrol cars >1500 cc
- 870331 – Diesel cars ≤1500 cc
- 870332 – Diesel cars >1500 cc
- 870340 – Other vehicles with spark/compression ignition
- 870380 – Electric vehicles
- 870390 – Other vehicles (hybrids, alternative fuel, special use)
GST Rates For Vehicles In India
GST and Compensation Cess on vehicles depend on the type:
- Petrol/Diesel Cars: 28% GST + 1% to 22% Compensation Cess
- Two-Wheelers >350cc: 28% GST + 3% Compensation Cess
- Electric Vehicles: 5% GST (No cess)
- Public Transport / Tractors: 12% GST (No cess)
HS Codes And GST Rates For Vehicle
Here’s a table listing major vehicle categories, HS codes, and applicable GST and cess rates:
🚗 GST & Cess on Vehicles (2025)
| 🚘 Product | 📦 HS Code | 📋 Category | 💰 GST | 🧾 Cess |
|---|---|---|---|---|
| 🚗 Petrol Car (≤1000cc) | 870321 | Small petrol cars | 28% | 1% |
| 🚙 Petrol Car (1001cc–1500cc) | 870322 | Mid-size petrol cars | 28% | 15% |
| 🚘 Petrol Car (>1500cc) | 870323 | Large petrol cars | 28% | 17%–22% |
| 🚜 Diesel Car (≤1500cc) | 870331 | Small diesel cars | 28% | 3% |
| 🚜 Diesel Car (>1500cc) | 870332 | Large diesel cars | 28% | 20%–22% |
| ⚡ Electric Vehicle (EV) | 870380 | Battery operated vehicle | 5% | 0% |
| 🌀 Hybrid / Other Vehicles | 870390 | Hybrid / alternative fuel | 28% | 15%–22% |
| 🚌 Bus for Public Transport | 870210 | More than 10 persons capacity | 12% | 0% |
| 🚜 Tractor (Agriculture) | 870110 | Used in farming only | 12% | 0% |
📌 Note: Electric and agricultural vehicles enjoy reduced GST & zero cess, while large fossil fuel vehicles carry heavy cess.
Final Thoughts
Vehicles are classified under HS Code 8701–8703, with further distinctions based on fuel type, usage, and engine capacity. In India, personal vehicles attract 28% GST plus compensation cess, while electric and agricultural vehicles enjoy concessional rates. Always classify vehicles accurately to ensure tax compliance and avail export/import benefits.
FAQs
Petrol cars are classified under HS 870321, 870322, and 870323 depending on engine size.
Most vehicles attract 28% GST, and electric vehicles attract 5%.
No, EVs, tractors, and public transport buses are exempt from cess.
Electric vehicles fall under HS code 870380.
Buses with a seating capacity >10 persons attract 12% GST with no cess.
