Peanut HSN Code

Understand the Right HSN Code for Peanuts

For businesses dealing with peanuts in India, understanding the correct HSN (Harmonized System of Nomenclature) code is essential for smooth taxation and trade. This blog post will clarify the HSN codes associated with peanuts and their respective GST rates.

Pinpointing the Peanut HSN Code and GST Rate

Peanuts, depending on their form and preparation, can fall under different HSN codes, leading to varying GST rates. It’s crucial to identify the precise classification for accurate compliance.

• For prepared or preserved peanuts (e.g., roasted, salted, or otherwise processed): The HSN code is 20081920. This code covers “Fruit, Nuts And Other Edible Parts Of plants, Otherwise Prepared Or Preserved, Whether Or Not Containing Added Sugar Orother Sweetening Matter Or Spirit, Notelsewhere Specified Or Included – Nuts, Ground – Nuts And Other Seeds, Whether Or Not Mixed Togethe.” Such prepared peanuts attract a 12% GST rate. This became effective on July 1, 2017.
• For specific peanut-based confections: Peanut chikki and other groundnut sweets fall under HSN code 1702. This broader code for “Sugars and sugar confectionery” includes items like “Chikkis Like Puffed Rice Chikki, Peanut Chikki, Sesame Chikki, Tilchikki, Tilpatti, Tilrevdi, Sugar Makhana, Groundnut Sweets, Gajak, Khaja, Khajuli, Anarsa.” These items are subject to a 5% GST rate. This also became effective on July 1, 2017.

It’s important to note that the data provided specifically mentions prepared or preserved peanuts under 20081920 and peanut chikki/groundnut sweets under 1702. For raw, unshelled, or shelled but unprocessed peanuts, a different HSN code would apply, typically under Chapter 12 (Oil seeds and oleaginous fruits; miscellaneous grains, seeds and fruit; industrial or medicinal plants; straw and fodder). However, the provided data does not cover those specific classifications.

The Importance of Correct HSN Codes

Accurate HSN code classification is vital for several reasons:

• Ensuring GST Compliance: The correct HSN code directly dictates the applicable GST rate, preventing under or overpayment of taxes.
• Streamlining Trade: A universally recognized HSN code simplifies customs procedures for both domestic and international trade.
• Avoiding Penalties: Misclassifying goods can lead to penalties and legal issues from tax authorities.
• Business Planning: Understanding HSN codes helps businesses accurately price products and forecast tax liabilities.