What is the GST rate for GTA (Goods Transport Agency) services in 2026?

After GST 2.0 reform effective September 2025, GTA services under forward charge attract either 5% without ITC or 18% with full input tax credit. The 5% no-ITC option is suitable for most GTAs with moderate input costs. The 18% with ITC option benefits GTAs with high GST-bearing costs like fleet purchases, fuel, and maintenance. GTAs must elect their rate option at the beginning of each financial year. When GTA services are provided under reverse charge (not forward charge), the recipient — if a registered body corporate, partnership, or factory — must pay 5% GST under RCM.

When does reverse charge (RCM) apply on transport services?

Reverse charge applies on GTA services when the GTA has not opted for forward charge and provides services to specified recipients: factories, companies (body corporates), LLPs, partnership firms, societies, co-operatives, and casual taxable persons. In these cases, the recipient must pay 5% GST under RCM, issue a self-invoice, and report it in their GSTR-1 and GSTR-3B. The RCM GST must be paid in cash — it cannot be paid using ITC. However, once paid in cash, the ITC on that RCM payment can be claimed in the same return period, making it cash-neutral for most registered businesses.

Is e-way bill mandatory for all goods transport?

E-way bill is mandatory for movement of goods valued above Rs 50,000, whether inter-state or intra-state (intra-state rules vary by state). The e-way bill must be generated before dispatch on the e-way bill portal. Validity depends on distance: 1 day for up to 200 km, 1 additional day for every additional 200 km. Exceptions include agricultural produce, food grains, milk, newspapers, defence equipment, and goods moved by non-motorized transport. Some states have their own exemption lists for intra-state movement. The consignor, consignee, or transporter can generate the e-way bill.

What is the GST rate on freight charges in India?

GST on freight charges depends on the mode of transport. Road freight via GTA: 5% (no ITC) or 18% (with ITC) under forward charge, or 5% under RCM. Rail freight: 5% GST. Air freight (domestic): 18% GST. Courier services: 18% GST. Inland waterways: 5% GST. Certain freight categories are fully exempt including agricultural produce, food grains, milk, and newspapers. For international exports, freight is either zero-rated (with LUT) or IGST is paid and refunded. Always verify the specific service category and carrier type to determine the exact applicable rate.

Does GST apply on auto-rickshaw or cab transport?

No. Transport of passengers by auto-rickshaws (both metered and contracted), metered taxis, and contract carriage buses with engine capacity below specified limits are exempt from GST. App-based cab services (Ola, Uber) are treated as ECO (Electronic Commerce Operators) under Section 9(5) — the platform is responsible for collecting and remitting 5% GST on the ride value. The individual cab driver does not separately charge GST. Passenger air transport attracts 5% for economy class and 12% for business class. Railway passenger transport is largely outside the GST framework.

How does GST apply on multimodal transport?

Multimodal transport — where goods are transported under a single contract using more than one mode (e.g., road + sea, rail + road) — is covered under SAC 9965. The entire supply is treated as a single supply under the multimodal transport operator's contract. Post-GST 2.0 reform, the applicable rate for multimodal transport should be verified against the latest CBIC notification, as the abolition of the 12% slab may have affected this category. The single consignment note covering the entire multimodal journey determines which GST rate applies to the complete transaction from origin to destination.

Can a transporter claim ITC on vehicle purchase under GST?

This depends on the transporter's rate option. Under the 5% GTA scheme (without ITC), no input tax credit is available on any purchases including vehicles, fuel, or tyres — even though these purchases carry embedded GST. Under the 18% GTA scheme (with ITC), full ITC is available on all GST-bearing inputs including truck purchases (heavy commercial vehicles attract 28% GST), tyres, spare parts, repair services, and insurance. The significant upfront ITC on a new commercial vehicle purchase (28% on vehicle value) can be a compelling reason for fleet-heavy GTAs to evaluate the 18% scheme at the time of fleet expansion.

Industry Guides

GST for Transport & Logistics: Rates, E-Way Bill & RCM Rules

GTA services, freight charges, multimodal transport, reverse charge mechanism — GST in transport is complex. This guide covers every rate, every exemption, and every compliance requirement for logistics businesses in 2026.

Himanshu25 March 2026 · 7 min read · updated 6 September 2026

Workers unloading goods from a truck in a rustic setting in Kolkata, India.

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Key takeaways

GTAs choose annually between 5% GST without ITC and 18% with full ITC; they cannot switch mid-year.
When a GTA has not opted for forward charge, factories, companies, LLPs and partnerships pay 5% under RCM in cash and claim ITC.
E-way bills are mandatory above Rs 50,000, valid 1 day per 200 km, and can be generated by consignor, consignee or transporter.
Rail and inland waterways freight are at 5%, air freight and courier at 18%, and agricultural produce, milk and food grains are exempt.

GST in Transport: Why It Is More Complicated Than Other Industries

Transport and logistics businesses face a unique set of GST challenges that most other industries do not. The same company can simultaneously be providing services at 0% (exempt transport), 5% (GTA without ITC), and 18% (courier services, packaging) depending on the nature of each consignment. On top of that, reverse charge mechanism (RCM) means that in many cases the recipient — not the transporter — is responsible for paying the GST.

Add the mandatory e-way bill requirement for goods movement above Rs 50,000, and you have a compliance framework that requires careful attention to billing, documentation, and return filing.

We will cover everything in this guide: Goods Transport Agency (GTA) rates and the forward charge vs reverse charge choice, freight charges, courier services, multimodal transport, the Rs 50,000 e-way bill threshold, RCM applicability, and which categories are fully exempt. Use our e-way bill tool to generate e-way bills and our GST calculator to verify freight charges on any consignment.

GTA GST Rates: Forward Charge Options

Goods Transport Agencies can choose their rate at the beginning of each financial year. After GST 2.0 reform, the rate options have changed.

Option	GST Rate	ITC Availability	Who Pays GST	Best For
GTA Forward Charge — Option A	5%	No ITC for GTA	GTA pays (forward charge)	GTAs with low input costs, simpler filing preferred
GTA Forward Charge — Option B	18%	Full ITC available	GTA pays (forward charge)	GTAs with high vehicle, fuel, and maintenance costs
GTA Reverse Charge	5% (effectively)	No ITC for GTA	Recipient pays under RCM	When supplying to registered businesses who handle RCM themselves

What Is a GTA and How Does the Rate Choice Work?

A Goods Transport Agency (GTA) is any person who provides road transport services for goods and issues a consignment note. The consignment note is the critical document — it is what distinguishes a GTA from a private truck owner just moving goods without formal documentation.

After GST 2.0 reform (effective September 2025): The previous 12% GTA rate with ITC has been revised upward to 18% to align with the elimination of the 12% slab. GTAs now have two forward charge options: 5% without ITC, or 18% with full ITC. This mirrors the pre-2.0 structure of 5% (no ITC) and 12% (with ITC), but the ITC option has moved to 18%.

The annual election: GTAs must choose their rate option at the beginning of each financial year by filing a declaration. If you are a GTA, you cannot switch mid-year. The choice between 5% and 18% follows the same logic as the restaurant ITC calculation — compare your net GST liability under both options given your fuel costs, vehicle EMIs, tyre replacements, and other GST-bearing inputs.

Practical example: A GTA with Rs 50 lakh monthly freight revenue and Rs 20 lakh monthly GST-bearing inputs (fuel, maintenance, tyres):

Under 5% (no ITC): GST liability = 5% of Rs 50 lakh = Rs 2,50,000

Under 18% (with ITC): GST collected = 18% of Rs 50 lakh = Rs 9,00,000. ITC on inputs = 18% of Rs 20 lakh = Rs 3,60,000. Net GST liability = Rs 9,00,000 - Rs 3,60,000 = Rs 5,40,000.

In this example, 5% wins. The 18% option would only win if your input costs with embedded GST exceeded roughly 72% of your freight revenue — which is unusual for most GTAs. However, if you have recent vehicle purchases with large GST on the EMI or have purchased a fleet, the ITC benefit in that year could flip the equation.

Issue consignment notes on every shipment and maintain a copy with the e-way bill. Our e-way bill tool helps you generate e-way bills linked to your consignment documentation.

Reverse Charge Mechanism (RCM) on Transport Services

RCM in transport is one of the most frequently confused compliance areas. Under Section 9(3) of the CGST Act, certain specified supplies attract reverse charge — meaning the recipient (not the supplier) must pay the GST directly to the government.

When does RCM apply to GTA services? RCM applies when a GTA (not opting for forward charge) provides services to specified recipients:

A factory or manufacturer
A society registered under the Societies Registration Act
A co-operative society established by law
A body corporate (companies, LLPs)
A partnership firm including LLP
A casual taxable person

If you are a registered company (body corporate) paying freight to a GTA transporter who has not opted for forward charge, you are responsible for paying 5% GST on that freight under RCM. You must issue a self-invoice, pay the RCM GST in cash (cannot use ITC to pay RCM), and then claim ITC on the RCM GST paid in the same return period.

RCM does NOT apply when: The GTA has opted for forward charge (they will charge you 5% or 18% on their invoice). Unregistered transporters moving goods for private individuals. Transport via rail, air, or water (different rules apply).

The self-invoice for RCM: Under Section 31(3)(f) of the CGST Act, when you pay under RCM to an unregistered or non-forward-charge GTA, you must issue a self-invoice. This self-invoice is filed in GSTR-1 as an inward supply attracting RCM. The corresponding ITC can then be claimed in GSTR-3B. In myBillPlease, you can generate RCM self-invoices for transport payments — the system auto-calculates the 5% RCM GST and tracks it separately from your regular invoices.

E-Way Bill: Mandatory for Consignments Above Rs 50,000

The e-way bill is an electronic document generated on the e-way bill portal (ewaybillgst.gov.in) for movement of goods worth more than Rs 50,000. It is mandatory for both inter-state and intra-state movement of goods (intra-state e-way bill requirements vary by state, but most states have adopted them).

Who generates it? The consignor (seller), consignee (buyer), or the transporter can generate the e-way bill. In practice, most businesses generate it before dispatch and share the e-way bill number with the transporter.

What it must contain: GSTIN of supplier and recipient, place of dispatch and delivery, HSN code of goods, value of goods (must exceed Rs 50,000 for generation to be required), vehicle number, and transporter details.

Validity: For distances up to 200 km — 1 day. For every additional 200 km — 1 additional day. So a consignment traveling 800 km has 4 days of validity. E-way bills can be extended before expiry if the consignment is delayed due to accidents, natural calamity, or other reasons.

When is e-way bill NOT required? Goods exempt from e-way bill include: goods transported by non-motorized conveyance, fresh vegetables and fruits, milk and curd, books and newspapers, defense equipment under Ministry of Defence, and goods moved within customs bonded areas. Check the state-specific e-way bill exemption list for intra-state movement as each state has its own notification.

Use our e-way bill generator to create, update, and cancel e-way bills directly from your shipment data — no separate portal login needed.

Transport Services Fully Exempt from GST

These transport services attract 0% GST — no need to charge or collect GST on these

Transportation of agricultural produce — crops, seeds, and agricultural goods by any mode
Transportation of milk, salt, food grains including rice and pulses, flour, eggs
Transportation of newspapers and magazines registered with the Registrar of Newspapers
Transportation of railway equipment and materials
Transportation of defence or military equipment
Transportation in a vessel from one port in India to another port (coastal shipping of goods)
Services provided by GTA to individuals (non-business use) for moving personal household goods
Passenger transport services — auto-rickshaws, metered cabs, contract carriage buses
Services by way of transportation of goods where the consideration is less than Rs 1,500 for a single carriage
Services by way of transportation of goods where the total amount charged for all goods transported for a single consignee is less than Rs 750

GST on Rail, Air, Sea, and Courier: Full Rate Guide

Beyond road transport via GTA, each mode of transport has its own GST rate structure:

Rail transport: Indian Railways is outside GST for most passenger services. Freight transport by railways (both Indian Railways and private rail operators) attracts 5% GST under SAC 9965. No ITC is available to the railway service provider on this. For businesses receiving railway freight services, RCM does not apply — Indian Railways and private rail operators charge GST directly on their bills.

Air freight: Air transport of goods (air cargo) attracts 18% GST under SAC 9965. This applies to domestic air freight. International air freight for exports is zero-rated. Air passenger transport is at 5% for economy class and 12% for business/first class.

Sea freight: Inland waterways transport of goods attracts 5% GST. Ocean freight on imported goods — this was previously subject to RCM but has been a contentious area. Currently, ocean freight for CIF imports is treated differently; consult your customs broker for the latest position as this has seen Supreme Court intervention.

Courier services: Courier services (door-to-door delivery with tracking, operated by courier companies) attract 18% GST under SAC 9968. This is different from GTA — couriers like Delhivery, DTDC, Blue Dart, FedEx, and DHL issue invoices with 18% GST. No RCM applies to courier services.

Multimodal transport: When a single contract covers transport using multiple modes (road + rail, road + sea), the entire supply is treated as multimodal transport and attracts 12% GST under SAC 9965 (post-GST 2.0, verify if this has moved to 18%). The single consignment note covering the entire multimodal journey determines the applicable rate for the complete journey.

For businesses moving high volumes of goods, tracking all these rates across different carriers and modes is complex. Use myBillPlease to record all your freight invoices and RCM entries correctly, ensuring your GSTR-2B reconciliation and ITC claims are accurate every month.

Frequently asked questions

What is the GST rate for GTA (Goods Transport Agency) services in 2026?: After GST 2.0 reform effective September 2025, GTA services under forward charge attract either 5% without ITC or 18% with full input tax credit. The 5% no-ITC option is suitable for most GTAs with moderate input costs. The 18% with ITC option benefits GTAs with high GST-bearing costs like fleet purchases, fuel, and maintenance. GTAs must elect their rate option at the beginning of each financial year. When GTA services are provided under reverse charge (not forward charge), the recipient — if a registered body corporate, partnership, or factory — must pay 5% GST under RCM.
When does reverse charge (RCM) apply on transport services?: Reverse charge applies on GTA services when the GTA has not opted for forward charge and provides services to specified recipients: factories, companies (body corporates), LLPs, partnership firms, societies, co-operatives, and casual taxable persons. In these cases, the recipient must pay 5% GST under RCM, issue a self-invoice, and report it in their GSTR-1 and GSTR-3B. The RCM GST must be paid in cash — it cannot be paid using ITC. However, once paid in cash, the ITC on that RCM payment can be claimed in the same return period, making it cash-neutral for most registered businesses.
Is e-way bill mandatory for all goods transport?: E-way bill is mandatory for movement of goods valued above Rs 50,000, whether inter-state or intra-state (intra-state rules vary by state). The e-way bill must be generated before dispatch on the e-way bill portal. Validity depends on distance: 1 day for up to 200 km, 1 additional day for every additional 200 km. Exceptions include agricultural produce, food grains, milk, newspapers, defence equipment, and goods moved by non-motorized transport. Some states have their own exemption lists for intra-state movement. The consignor, consignee, or transporter can generate the e-way bill.
What is the GST rate on freight charges in India?: GST on freight charges depends on the mode of transport. Road freight via GTA: 5% (no ITC) or 18% (with ITC) under forward charge, or 5% under RCM. Rail freight: 5% GST. Air freight (domestic): 18% GST. Courier services: 18% GST. Inland waterways: 5% GST. Certain freight categories are fully exempt including agricultural produce, food grains, milk, and newspapers. For international exports, freight is either zero-rated (with LUT) or IGST is paid and refunded. Always verify the specific service category and carrier type to determine the exact applicable rate.
Does GST apply on auto-rickshaw or cab transport?: No. Transport of passengers by auto-rickshaws (both metered and contracted), metered taxis, and contract carriage buses with engine capacity below specified limits are exempt from GST. App-based cab services (Ola, Uber) are treated as ECO (Electronic Commerce Operators) under Section 9(5) — the platform is responsible for collecting and remitting 5% GST on the ride value. The individual cab driver does not separately charge GST. Passenger air transport attracts 5% for economy class and 12% for business class. Railway passenger transport is largely outside the GST framework.
How does GST apply on multimodal transport?: Multimodal transport — where goods are transported under a single contract using more than one mode (e.g., road + sea, rail + road) — is covered under SAC 9965. The entire supply is treated as a single supply under the multimodal transport operator's contract. Post-GST 2.0 reform, the applicable rate for multimodal transport should be verified against the latest CBIC notification, as the abolition of the 12% slab may have affected this category. The single consignment note covering the entire multimodal journey determines which GST rate applies to the complete transaction from origin to destination.
Can a transporter claim ITC on vehicle purchase under GST?: This depends on the transporter's rate option. Under the 5% GTA scheme (without ITC), no input tax credit is available on any purchases including vehicles, fuel, or tyres — even though these purchases carry embedded GST. Under the 18% GTA scheme (with ITC), full ITC is available on all GST-bearing inputs including truck purchases (heavy commercial vehicles attract 28% GST), tyres, spare parts, repair services, and insurance. The significant upfront ITC on a new commercial vehicle purchase (28% on vehicle value) can be a compelling reason for fleet-heavy GTAs to evaluate the 18% scheme at the time of fleet expansion.