Rakhi is not just a sacred bond; it is also a part of our cultural heritage. Traders often get confused about the HSN code and applicable GST rate while selling Rakhi. Knowing the correct HSN code makes tax calculation easy and also avoids legal problems. Let’s take a look at the HSN code and GST rates prescribed for Rakhi.
| Chapter | Description | HSN Code | Rate (%) | CESS (%) | Effective Date | Rate Revision |
| Other made-up textile articles; sets; worn clothing and worn textile articles; rags | Other Made-Up Articles, Including Dress Patterns Other: Other | 63079090 | 12% | – | 01/07/2017 | No Change |
| Miscellaneous manufactured articles | Hand Sieves and Hand Riddles | 96040000 | 18% | – | 01/07/2017 | 18% |
| Natural or cultured pearls, precious or semi-precious stones, precious metals, metals clad with precious metal, and articles thereof; imitation jewelry; coin | Imitation Jewellery Rakhi – Other: Other | 71179090 | 3-5% | – | 01/07/2017 | No Change |
What is the HSN Code for Rakhi with Textile Decoration?
If cloth, yarn, or other textile materials are used in Rakhi, then its HSN code will be 63079090. Generally, 12% GST is applicable on it. There is no change in this category in the new 2025 revised rate. It will be easy for traders to determine the tax if they use the correct code while selling Rakhi.
Which Code will be Used for Cotton-based Rakhi?
If the rakhi is made entirely of cotton yarn or cloth, then the HSN code will be 62046290. As per the new tax rules, 5% GST is applicable on it. Cotton rakhi is currently gaining popularity, as it is eco-friendly, and many traders are making such rakhi.
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Why is a Separate GST Applicable to Rakhi Packaging?
Rakhi itself is often exempted from GST, but packaging materials such as paper packets, cloth bags, or gift boxes fall under different HSN codes. It may have a GST of 12% or more. Traders will have to show Rakhi and packaging separately in their invoices.
Do you Need to Pay Tax on Selling Rakhi for Export?
No, exported Rakhi is considered as “Zero-rated supply”, i.e. tax rate is zero. However, traders have to provide this information in their GST returns and mention the correct HSN code in the invoice for the shipment. Exporters can also claim input tax credit for this.
Is there any CESS Applicable to Rakhi?
No, there is no CESS applicable to Rakhi. It is levied only on certain specific products such as luxury or harmful goods (tobacco, beverages, etc.). Since Rakhi is a cultural and general consumer good, only the GST rate applies to it.
How will Rakhi Traders Choose the Right HSN Code?
First, the material and design of the Rakhi should be checked. If it is only a religious Rakhi, then HSN code 95059090 is applicable. If it has ornaments or textiles attached, then the relevant code should be used. Entering the wrong code can result in a penalty, so it’s wise to seek the help of a tax consultant.
Conclusion
Selecting the correct HSN code for Rakhi will save traders from tax-related mistakes. As per the new GST rates, each product category is different, so it is important to know the code in advance. Using the correct HSN code will make your business transparent, legal, and hassle-free.
For any GST-related queries or GST return filing, talk to our experts at Corpbiz.
Frequently Asked Questions about HSN Codes for Rakhi with GST Rates
Is Rakhi fully exempt from GST?
Yes, ordinary Rakhi is considered a religious article under HSN code 95059090 and is fully exempted from GST. However, if ornaments or other decorative materials are used in Rakhi, then it may fall under a different HSN code, and a different GST rate will be applicable. Therefore, it is important to classify the sellers correctly.
Which code is applicable for Rakhi with imitation jewellery?
Rakhis that use imitation jewellery like fake stones, pearls, or beads fall under HSN code 71179090 with 3% GST. This is important for Rakhi traders because decorated Rakhis are very popular in the market. If the tax is not determined correctly, there can be a penalty.
What is the GST for handmade or crafted Rakhi?
Rakhis that are handmade and additional accessories or craft materials that are used can fall under HSN code 96040000 with 18% GST. In 2025, some amendments were made to this category to identify handicraft items separately.
What is the HSN code for Rakhi packets or packaging?
The HSN code for Rakhi packets or packaging depends on the material of the packet. If the packet is made of paper or paperboard, then the HSN code will be 48189900, and the GST will be 12%. Traders should keep in mind that not only the Rakhi but also the packaging material is subject to separate tax.
What is the code for Rakhi gift hampers or baskets?
If Rakhi is sold as a gift in a cloth basket or packaging, then the HSN code will be 63079990 with 12% GST. Many traders also give sweets or small gifts along with Rakhi, so more than one code may apply to a gift set. This is considered a mixed supply.
Is the GST exemption applicable only for Rakhi?
No, GST exemption is applicable only for ordinary rakhi, which are considered religious articles. However, rakhis that have ornaments, textiles, or handicrafts added to them are classified under other HSN codes, so GST is applicable in that case.
Does zero tax on Rakhi mean that traders will not file returns?
No, even if Rakhi is exempt from GST, traders are obliged to file returns. Information about the sale of zero tax rate products also has to be mentioned in the GST return. This is part of the legal process. Traders may face penalties if they do not file returns.
Will the HSN code of rakhi be different when exported abroad?
No, since the HSN code is internationally recognized, the same code is used in domestic and foreign markets. However, zero-rated supply is applicable during exports. If traders mention the code correctly in the invoice, there will be no problem in exports.
What GST rate will be applicable when selling Rakhi gift sets?
If Rakhi is sold as a gift set with sweets, dry fruits, or any other items, then it is considered a “mixed supply.” In this case, the product with the higher tax rate applies to the entire set. Therefore, the tax rate may increase when selling sweets with Rakhi.
Is GST mandatory when selling Rakhi online?
Yes, GST registration and invoicing are mandatory when selling Rakhi online, even if the Rakhi is exempted. The correct HSN code of the product must be mentioned while selling on e-commerce platforms like Amazon or Flipkart. Otherwise, you may face problems during return or tax verification.
Why is Rakhi exempted from GST as a religious article?
Rakhi is a cultural and religious symbol, which is used as a symbol of the sacred relationship between brother and sister. Therefore, the government has recognized it as a religious article and has kept it tax-free under HSN code 95059090. However, if ornaments or special elements are added, it falls under the general category, and tax is levied.
Is GST applicable to the raw materials used in the production of Rakhi?
Yes, GST is applicable on the raw materials like yarn, beads, paper, or ornaments used in making Rakhi under a separate HSN code. Although the general Rakhi as the end product is tax-free, traders have to pay GST at the time of purchase of the raw materials. It can be adjusted later as an input tax credit.
Does a business need to register for GST if it sells rakhis?
If your annual turnover is more than the government-set limit (₹40 lakh as of 2025), then GST registration is mandatory. Even if rakhis are tax-free, registration is required for the business. Otherwise, you will not be able to claim input tax credit, and it will be difficult to take large orders.
Will the separate GST be applicable if bonus items are given along with rakhis?
Yes, if a pen, notebook, or any small gift is given along with rakhis, then it is considered a mixed supply. Even if the original rakhis are tax-free, the highest tax rate may be applicable on the entire set. Therefore, sellers should mention the rakhis and other products in separate invoices.
Will small businesses be exempt from GST if they sell rakhis?
If the business's annual turnover is below the government-set limit (say ₹40 lakh as of 2025), then they can be exempted from GST registration. However, if you want to sell on e-commerce platforms, GST registration is mandatory, regardless of the limit.
Has the GST rate of Rakhi changed in the 2025 tax reform?
The tax rate of general Rakhi has been kept unchanged, and it has been kept tax-free. However, revised rates have been applicable in some categories, such as handmade Rakhi (96040000) and cotton-based Rakhi (62046290). So, traders will now have to look at different classifications according to each type of Rakhi.
