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Taxation Central Ministry of Finance Central Goods and Services Tax Act, 2017

CBIC issues Clarification Regarding GST Classification, Rates and Input Tax Credit on Specified Goods and Motor Vehicles

28-Oct-2026 | Circular No. 265/11/2026-GST

CBIC has issued Clarification Regarding GST Classification, Rates and Input Tax Credit on Specified Goods and Motor Vehicles with effect from 28th October 2026 Key highlights are as follows :- 1) Sublimation paper has been clarified to be classifiable under heading 4809 and attract GST at 18% under S. No. 176 of Schedule II of Notification No. 09/2025-Central Tax (Rate) dated 17 September 2025. Past classification and rate disputes have been recommended for regularisation on an “as is where is” basis. 2) The relevant entries under heading 9503 cover all categories of toys including dolls and dolls’ carriages scale models and puzzles and are not restricted to the illustrated wheeled toys. Non-electronic toys attract GST at 5% whereas electronic toys attract GST at 18%. 3) The restriction on ITC applies only to tax paid on the procurement of second-hand vehicles. Dealers may claim ITC on other eligible inputs and input services including spare parts repairs technology services rent marketing and advertising subject to the conditions prescribed under the CGST Act 2017. 4) Seaweed extract-based bio-stimulants registered under Schedule VI to the Fertiliser (Inorganic, Organic or Mixed) (Control) Order 1985 have been clarified to be classifiable under heading 3101. An explanation has been inserted in the relevant GST rate entry to implement the Council’s recommendation. Past classification disputes concerning these bio-stimulants have also been recommended for regularisation on an “as is where is” basis. For more information kindly refer the attached document

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