GST on Laptops: Applicable Rates & HSN Code for Computer Accessories

With the introduction of GST in 2017, tax filing has become a more straightforward procedure. While GST has simplified this task, it is also important to note that the impact of GST spills over to the prices of products you may wish to purchase as well. This will help you understand how to calculate GST and the effect on goods in your everyday life. One such product that has witnessed a price change is the laptop or personal computer and related accessories.

While laptops were expensive until a decade ago, they became more reasonable as technology became accessible. Post GST, however, they have become expensive once again. To understand this phenomenon better, here is a crash course on how GST rates are determined and all you need to know about GST's impact on the prices of computer parts and other computer products.

What is GST on laptops?

In India, the GST on laptops is 18%. This rate may be periodically revised by the GST Council, so it's important to stay updated on any changes. The 18% GST applies to various electronic items, including laptops, and is applicable to all laptop sales nationwide.

GST rates on laptops and computer accessories

The GST Council determines the GST rates for various goods and services. To regulate taxation and optimise the process, the council reviews and revises GST rates periodically. Further, the government's rates are being considered for reduction as GST tax collections are rising above the projections. This is evident in the fact that earlier, the rate for laptops was 18%, and now it has reduced to 12%. You can use a GST calculator to work out the GST rates.

Understanding GST and HSN choice on laptops and computers

Various harmonized system of nomenclature (HSN) codes have been assigned to products to arrive at the GST rate for various goods. So, to understand the GST rate applicable for any laptop or computer product, you must look up the HSN code linked to the same.

Additional read: How does GST impact your Business?

Chapter 84 of the HSN consists of the HSN codes for personal computers, micro-computers, and laptops. These are listed under the 'automatic data processing machines and units' head. According to this chapter, specific products qualify as automated data processing machines and units. Look at what they are below.

• Equipment that can store processing programmes and the data that is necessary for the execution of the programme
• Equipment that can be programmed to function according to the user's needs and requirements
• Equipment that can perform arithmetical computations that the user requests.
• Equipment that can function and conduct logical modification actions without human involvement.

However, it is important to note that these machines need not be a single unit like a laptop. It can consist of multiple units like you would find in a computer.

Additionally, items can also qualify as data processing machines if they are connected to another data processing machine and are either solely or principally used in the system's functioning. In other words, they also qualify if they are connected to the central processing unit directly or through other units and can accept or deliver data in the form of codes and signals. So, your mouse, keyboard, and even a USB storage device can be classified under HSN code 8471.

Look at the various HSN codes on computer products under HSN chapter 84.

• 8471 is the HSN code for automatic data processing machines and units thereof; magnetic or optical readers, machines for transcribing data onto data media in coded form and machines for processing such data, not elsewhere specified or included.
• 8471 30 is the HSN code for portable digital automatic data processing machines, weighing not more than 10 kg, consisting of at least a central processing unit, a keyboard, and a display.
• 8471 30 10 is the HSN code for personal computer.
• 8471 41 is the HSN code for other automatic data processing machines. Comprising in the same housing at least a central processing unit and an input and output unit, whether or not combined.
• 8471 41 10 is the HSN code for microcomputer.
• 8471 41 20 is the HSN code for a large or mainframe computer.
• 8471 41 90 is the HSN code for other under automatic data processing machines.
• 8471 49 00 is the HSN code presented in the form of systems.
• 8471 50 00 is the HSN code for processing units other than those of sub-headings 8471 41 or 8471 49, whether or not containing in the same housing, one or two of the following types of unit: storage units, input units, and output units
• 8471 60 is the HSN code for input or output units, whether or not containing storage units in the same housing.
• 8471 60 10 is the HSN code for combined input or output units.
• 8471 60 25 is the HSN code for a plotter.
• 8471 60 29 is the HSN code for others, under the printer category.
• 8471 60 40 is the HSN code for a keyboard.
• 8471 60 50 is the HSN code for a scanner.
• 8471 60 60 is the HSN code for a mouse.
• 8471 60 90 is the HSN code for other.
• 8471 70 is the HSN code for storage units.
• 8471 70 10 is the HSN code for floppy disc drives.
• 8471 70 20 is the HSN code for hard disc drives.
• 8471 70 30 is the HSN code for removable or exchangeable disc drives.
• 8471 70 40 is the HSN code for magnetic tape drives.
• 8471 70 50 is the HSN code for cartridge tape drives.
• 8471 70 60 is the HSN code for CD-ROM drives.
• 8471 70 70 is the HSN code for digital video disc drives.
• 8471 70 90 is the HSN code for other, under storage units.
• 8471 80 00 is the HSN code for other units of automatic data processing machines.
• 8471 90 00 is the HSN code for other.

Different types of GST applicable on laptops, desktops, and accessories

The types of GST applicable to laptops, desktops, and their accessories are CGST (Central Goods and Services Tax), SGST (State Goods and Services Tax), and IGST (Interstate Goods and Services Tax). For intra-state transactions, the total GST on laptops and desktops is 18%, split equally into 9% CGST and 9% SGST. However, for inter-state transactions, such as those involving e-commerce, IGST at 18% will apply on these products and services.

How was tax levied on laptops in the pre-GST era?

In the pre-GST era, laptops were taxed based on the state VAT rates, which varied between 5% to 15%. The VAT rates also differed based on the location of the sale, whether it was an inter-state or intra-state transaction, and whether the laptop was sold as a part of a bundle deal or as a standalone item.

While you may have already been well informed about GST registration and GST return filing, you now possess the knowledge regarding GST on laptops in India, GST on computers, and GST rates for printers. As a result, you can use this information to your advantage and make a smart purchase decision when shopping for an electronic device like a laptop.

Understanding the impact of GST rates on laptops and computers is essential for informed purchasing decisions and precise financial planning, whether for personal use or securing a business loan.

Additionally, you can explore more articles related to GST