GST on clothes near ₹2,500: what sellers do
A piece at ₹2,500 pays 5% GST, which is ₹125; a piece at ₹2,501 pays 18%, which is ₹450.18. One rupee more adds ₹325.18 of tax. The buyer pays ₹2,625 for the first and ₹2,951.18 for the second, so lehenga and party-wear sellers with pieces between ₹2,400 and ₹2,900 feel this line most.
GST is charged on the transaction value, the price actually paid; CBIC lets a discount recorded on the invoice at the time of sale stay out of it (CBIC valuation flier). Talk to your CA before you use one to bring a piece under ₹2,500. Work out your margin per piece with the price per piece calculator guide and the Meesho commission calculator.
Cloth GST rate: garments, fabric and yarn
The ₹2,500 test runs on each piece, not on the invoice or order total, so a ₹6,000 order of four ₹1,500 kurtas is four pieces at 5%, not one sale at 18% (PIB factsheet).
GST on textiles: fabric and yarn
GST on textiles is 5% for the main woven and knitted fabrics, and the 22 Sept 2025 reset cut man-made fibre from 18% to 5% and man-made yarn from 12% to 5%. Fabric has no price band: a silk saree length pays 5% at any price.
| Item | Before 22 Sept 2025 | From 22 Sept 2025 | Source |
|---|---|---|---|
| Man-made fibre | 18% | 5% | PIB factsheet |
| Man-made yarn | 12% | 5% | PIB factsheet |
| Silk fabric (5007) | — | 5% | Notification 9/2025–IT(Rate), Sch. I S.No. 326 |
| Woven cotton fabric (5208 to 5212) | — | 5% | Notification 9/2025–IT(Rate), Sch. I S.No. 334 |
| Woven man-made filament fabric (5407, 5408) | — | 5% | Notification 9/2025–IT(Rate), Sch. I S.No. 342 |
| Knitted fabric | — | 5% | Notification 9/2025–IT(Rate), Sch. I S.No. 387 |
A dash means the earlier rate is not in the sources we checked. Sources: PIB factsheet and Notification 9/2025–IT(Rate), read on the CBIC copy. Last checked: 11 Oct 2026.
Why GST on clothes answers disagree online
Most wrong answers about GST on clothes are the old rule still in print: 5% up to ₹1,000 and 12% above. That rule ended on 22 September 2025.
- "₹1,000 / 5% / 12%" is the pre-22 Sept 2025 rule; the line is now ₹2,500 (PIB factsheet).
- "Clothes below ₹1,000 are exempt" was never right for readymade garments: they paid 5% then and pay 5% now.
- "Generally 5% or 12%" mixes the old band with the new. A ₹2,800 dress priced at 12% under-charges tax by 6 points on every piece.
Is the 12% GST slab removed? New GST rates on readymade garments
For readymade garments the 12% band is gone: since 22 September 2025 the only rates are 5% up to ₹2,500 a piece and 18% above. PIB describes the wider GST 2.0 reset as two rates, a standard 18% and a merit 5%, plus a special de-merit rate of 40% (PIB).
Pieces from ₹1,001 to ₹2,500 moved down, from 12% to 5%; only pieces above ₹2,500 moved up, from 12% to 18%.
- 5% GST items for a clothing seller: garments and made-ups up to ₹2,500 a piece, silk, woven cotton, man-made filament and knitted fabric at any price, and man-made fibre and yarn.
- 18% GST items: garments and made-ups above ₹2,500 a piece.
- 12% and 28%: no apparel or fabric line here uses them after 22 September 2025.
How to calculate GST on clothes
To calculate GST on clothes, apply 5% or 18% to the sale value of one piece, then split the tax by where the buyer is. A ₹1,500 shirt pays ₹75: ₹37.50 CGST plus ₹37.50 SGST in your state, or ₹75 IGST across states.
- Find the sale value of one piece on its invoice line.
- Pick the rate: 5% up to ₹2,500, 18% above.
- Split it on the invoice: 5% is 2.5% CGST plus 2.5% SGST within the state, or 5% IGST across states; 18% is 9% plus 9%, or 18% IGST.
- Enter the same rate and the HSN code on the marketplace: 4 digits for turnover up to ₹5 crore, 6 digits above, as CBIC Notification 78/2020–Central Tax requires from 1 April 2021.
For a Meesho supplier: a ₹449 kurti pays ₹22.45 at 5%; a ₹1,299 kurta shipped to another state pays ₹64.95 as 5% IGST; a ₹2,999 lehenga pays ₹539.82 as 18% IGST. If your listed price includes GST, the tax inside it is price × rate ÷ (100 + rate).
Our HSN code finder uses the same band: knitted kurtis (6106), woven kurtis (6206), lehengas (6204, see the lehenga HSN code page) and ready-to-wear sarees (6211) carry "5% up to ₹2,500 a piece, 18% above"; silk, cotton and synthetic saree lengths carry a flat 5%.
HSN codes for common clothing
Every garment below follows the ₹2,500 rule but has its own code. Confirm it on the GST portal HSN search before you file.
| Item | Page |
|---|---|
| Clothes (overview) | HSN code for clothes |
| T-shirts | T-shirt HSN code |
| Shirts | Shirt HSN code |
| Kurti | Kurti HSN code |
| Saree | Saree HSN code |
| Salwar suit, dress material | Suit HSN code |
| Dresses, gowns | Dress HSN code |
| Trousers, pants, leggings | Pant HSN code |
| Jeans | Jeans HSN code |
| Jackets, coats | Jacket HSN code |
| Unstitched fabric | Fabric HSN code |
| Lehenga, lehenga choli | Lehenga HSN code |
This is a summary for sellers, not tax advice; check with your CA for your case. Last checked: 22 Oct 2026.
Frequently asked questions
What is the GST on clothes in 2026?
5% if one piece sells for ₹2,500 or less and 18% above, as set from 22 September 2025 by CBIC Notification 9/2025–CT(Rate) (PIB factsheet).
What is the GST rate on cloth (fabric)?
5% at any price for silk, woven cotton, man-made filament and knitted fabric, including unstitched saree lengths and dress material; man-made fibre and yarn are 5% too (Notification 9/2025–IT(Rate)).
Is there GST on clothes above ₹1,000?
Yes, 5% up to ₹2,500 and 18% above; ₹1,000 was the limit before 22 September 2025. A ₹1,800 kurta now pays 5%, not the old 12%.
Is the 12% and 28% GST slab removed for clothes?
For clothes, yes: garments pay 5% up to ₹2,500 a piece and 18% above. PIB describes GST 2.0 as 18% standard and 5% merit, plus a special 40% de-merit rate.
Is GST on clothes 18% now?
Only above ₹2,500 a piece; at ₹2,500 or less a garment pays 5%.
How do I calculate GST on clothes?
Multiply one piece's sale value by 5% (up to ₹2,500) or 18% (above). A ₹2,000 dress pays ₹100: ₹50 CGST and ₹50 SGST inside your state.
Related
Checked by the StitchMagic team on 22 Oct 2026. StitchMagic is a set of free tools and one AI listing agent (ListMagic) for online sellers in India that helps them list faster on Meesho, Flipkart and Amazon.in and sell more. Found an error? Tell us; we correct with a dated note.