Changes in Compensation Cess Rate Notification w.r.t. supply of certain goods from January 01, 2022 to align it with HS 2022
Background:
Earlier, the CBIC issued Notification No. 1/2017-Compensation Cess (Rate) dated June 28, 2017 (Compensation Cess Rate Notification) in order to notify the rate of GST compensation cess to be levied on the intra-State supplies or inter-State supplies of certain goods mentioned therein.
Further, the new (seventh) edition of the Harmonized System (HS) nomenclature i.e., HS-2022, has come into force from January 01, 2022. This edition has introduced significant changes to the Harmonized System with a total of 351 amendments at the six-digit level, covering a wide range of goods moving across borders.
As India is a party to the HS convention, necessary changes were brought in accordingly, in GST through the below mentioned notification:
Notification:
The CBIC vide Notification No. 2/2021-Compensation Cess (Rate) dated December 28, 2021 has amended the relevant entries of the Compensation Cess Rate Notification w.e.f. January 1, 2022, in the following manner:
| S. No. | Old HSN | Old Entry | New HSN | New Entry |
| 25 | 2403 91 00 | Homogenised” or “reconstituted” tobacco, bearing a brand name | 2403 91 00 or 2404 11 00 | Homogenised” or “reconstituted” tobacco, bearing a brand name |
| 37 | 2403 99 90 | All goods, other than pan masala containing tobacco ‘gutkha’, bearing a brand name | 2403 99 90 or 2404 11 00 or 2404 19 00 | All goods, other than pan masala containing tobacco ‘gutkha’, bearing a brand name |
| 38 | 2403 99 90
|
All goods, other than pan masala containing tobacco ‘gutkha’, not bearing a brand name | 2403 99 90 or 2404 11 00 or 2404 19 00 | All goods, other than pan masala containing tobacco ‘gutkha’, not bearing a brand name |
| 54 | 8802 | Other aircraft (for example, helicopters, aeroplanes), for personal use. | 8802 or 8806 | Other aircraft (for example, helicopters, aeroplanes), for personal use. |
The Notification can be accessed at: Notification No. 2/2021-Compensation Cess (Rate) 28th December, 2021
Background:
Earlier, the CBIC issued Notification No. 21/2018- Central Tax (Rate) dated July 26, 2018 (“the Concessional Rate Notification”) in order to prescribe concessional GST rate on specified handicraft items.
Further, the new (seventh) edition of the Harmonized System (HS) nomenclature i.e., HS-2022, has come into force from January 01, 2022. This edition has introduced significant changes to the Harmonized System with a total of 351 amendments at the six-digit level, covering a wide range of goods moving across borders.
As India is a party to the HS convention, necessary changes were brought in accordingly, in GST through the below mentioned notification:
Notification:
The CBIC vide Notification No. 20/2021- Central Tax (Rate) dated December 28, 2021 has amended relevant entries of the Concessional Rate Notification w.e.f. January 1, 2022, in the following manner:
| S.No. | Old HSN | Old Entry | New HSN | New Entry |
| 4 | 4414 00 00 | Wooden frames for painting, photographs, mirrors etc. | 4414 | Wooden frames for painting, photographs, mirrors etc. |
| 29 | 7419 99 | Art ware of brass, copper/ copper alloys, electro plated with nickel/silver | 7419 80 | Art ware of brass, copper/ copper alloys, electro plated with nickel/silver |
Similar notifications have been passed under Integrated Goods and Services Tax Act, 2017 (“IGST Act”) and Union Territory Goods and Services Tax Act, 2017 (“UTGST Act”).
CGST (Rate) Notification: Notification No. 20/2021- Central Tax (Rate) dated December 28, 2021
IGST (Rate) Notification: Notification No. 20/2021-Integrated Tax (Rate) Dated 28th December, 2021
UTGST (Rate) Notification: Notification No. 20/2021-Union Territory Tax (Rate) Dated 28th December, 2021
Our comments:
Similar changes have been adopted in Custom Tariff Act, 1975 from January 01, 2022 so as to align the same with HS 2022 vide D.O.F.No.524/11/2021-STO(TU) dated December 20, 2021
The Letter can be accessed at: Harmonized System nomenclature, HS-2022 applicable from 01.01.2022
The HSN Amendments chapter wise can be accessed at: https://www.a2ztaxcorp.com/wp-content/uploads/2021/12/HSN-Amendments-Chapterwise-from-Jan-1-2022.pdf
Correlation of Customs Tariff between 2021-2022 can be accessed at: https://www.cbic.gov.in/resources//htdocs-cbec/deptt_offcr/Guidance%20Document%20on%20Correlation%20of%20Customs%20Tariff%20between%202021%20and%202022.pdf
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