Ayurvedic HSN Code

Understanding the Ayurvedic HSN Code

Ayurveda, the ancient Indian system of medicine, offers a holistic approach to health and wellness. As Ayurvedic products gain global recognition, understanding their HSN (Harmonized System of Nomenclature) codes is crucial for businesses involved in their manufacturing, trade, and export from India. The HSN system helps classify goods for customs and taxation, including Goods and Services Tax (GST) in India.

The good news is that “Ayurvedic” products, when intended for therapeutic or prophylactic (preventive) uses, largely fall under a specific chapter dedicated to pharmaceutical products.

The Core Classification: Chapter 30

Most Ayurvedic medicines are classified under Chapter 30: Pharmaceutical products. This chapter is designed for products used in medicine, whether for human or veterinary purposes.

Within Chapter 30, Ayurvedic medicaments are specifically found under:

• HSN Heading 3003: Medicaments (excluding goods of heading 3002, 3005 or 3006) consisting of two or more constituents which have been mixed together for therapeutic or prophylactic uses, not put up in measured doses or in forms or packings for retail sale.

And its sub-headings explicitly cover Ayurvedic formulations:

• 30039011: Medicaments of Ayurvedic system
• 30039012: Medicaments of Unani system
• 30039013: Medicaments of Siddha system
• 30039014: Medicaments of Homoeopathic system
• 30039015: Medicaments of Bio-chemic system

The common thread among these specific HSN codes is that they apply to “medicaments” that are not yet put up in measured doses or in retail packing. This often refers to bulk Ayurvedic formulations or ingredients before final packaging for consumers.

What about Packaged Ayurvedic Medicines?

While the data provided focuses on 3003 codes, it’s important to know that for Ayurvedic medicines put up in measured doses or in forms or packings for retail sale, the HSN classification typically shifts to:

• HSN Heading 3004: Medicaments (excluding goods of heading 3002, 3005 or 3006) consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses (including those in the form of transdermal administration systems) or in forms or packings for retail sale.

Similar to 3003, this heading also has specific sub-codes for Ayurvedic, Unani, Siddha, Homoeopathic, and Bio-chemic systems, such as 30049011 for “Medicaments of Ayurvedic system” when put up for retail sale.

GST Rates for Ayurvedic Products

The GST rate for Ayurvedic medicines, whether under HSN 3003 or 3004, is generally 12%. This rate has been in effect since July 1, 2017. There have been discussions and some instances where certain traditional or pure Ayurvedic preparations might attract a 5% GST, especially if unbranded or directly derived from classical texts. However, the prevailing rate for most branded or proprietary Ayurvedic medicaments is 12%.

Beyond Medicaments: Ayurvedic Cosmetics or Food Products

It’s crucial to distinguish between Ayurvedic medicaments and other Ayurvedic products like cosmetics (e.g., Ayurvedic soaps, shampoos, skincare) or food preparations (e.g., Chyawanprash that is marketed as a health supplement rather than a medicine). These would fall under different HSN chapters based on their primary composition and intended use. For instance, Ayurvedic cosmetics would likely be under Chapter 33 (Essential oils and resinoids; perfumery, cosmetic or toilet preparations), and some Ayurvedic health supplements might fall under Chapter 21 (Miscellaneous edible preparations).

Accurate HSN classification is vital for businesses to ensure compliance with GST regulations, avoid penalties, and streamline domestic and international trade of Ayurvedic products. Always refer to official government notifications and seek professional advice for specific product classifications.