The Directorate General of GST Intelligence (DGGI) clarified that 18% of Goods and Service Tax (GST) is applicable to the Hand Sanitizer and not 12% of GST.
As per the World Customs Organisation (WCO), the Central Economics Intelligence Bureau (CEIB) informed DGGI that some manufacturers of “Hand Sanitizers (Alcohol-based)” are wrongly classifying the said item under tariff heading 3004 (12% GST) whereas the said item is liable to be classified under tariff heading 3808 (18% GST).
It has also been informed that Sugar Mills and distilleries are also engaged in manufacturing or supplying alcohol-based hand sanitizers and are classifying the same under tariff heading 3004 (12% GST) of HSN whereas the same is correctly classifiable under heading 3808 (18% GST) of HSN.
Thus, the misclassification of Hand sanitizers’ (Alcohol-based) appears to have resulted in substantial evasion of GST. “Intelligence furnished by the CEIB has been further developed in the DGGI Hqrs. A list of 62 manufacturers/suppliers of above said the item was prepared by the DGGI Headquarters by identifying the manufacturers with the help of the online shopping platforms, such as Amazon, Flipkart, Snapdeal, Paytm, etc. and has been analyzed in DGGI,” the letter said.
“While the misclassification of Hand Sanitizers produced under various established brands is being looked into by various Zonal Units of DGGI, it is requested that misclassification of Hand Sanitizers manufactured/supplied by sugar factories/distilleries in your jurisdiction may kindly be verified at your end in order to plug any revenue Images,” the DGGI requested.