New GST Rate On Particle Board / Articles Of Wood / Packing Cases,
Boxes - GST Rates On Wood Sector Goods:
The 56th meeting of
the GST Council, held on 3rd September, 2025 under the
chairpersonship of Union Finance & Corporate Affairs Minister Smt.
Nirmala Sitharaman, brought significant relief to the wood and allied
products sector.
One of the key highlights
of the meeting was the reduction of GST rates from 12% to 5% on a wide
range of wood-based goods, benefiting both manufacturers and the common
man. The decision is expected to boost traditional industries, promote
eco-friendly alternatives, and reduce costs for consumers.
GST Rate Changes – Wood
Sector
(A) From 12% to 5%
|
S.
No.
|
Chapter
/ Heading / Tariff Item
|
Description
of Goods
|
|
1
|
44
or any Chapter
|
The
following goods: (a) Cement Bonded Particle Board (b) Jute Particle Board (c)
Rice Husk Board (d) Glass-fibre Reinforced Gypsum Board (GRG) (e) Sisal-fibre
Boards (f) Bagasse Board (g) Cotton Stalk Particle Board (h) Particle/fibre
board manufactured from agricultural crop residues
|
|
2
|
4404
|
Hoopwood;
split poles; piles, pickets and stakes of wood, pointed but not sawn
lengthwise; wooden sticks, roughly trimmed but not turned, bent or otherwise
worked, suitable for manufacture of walking-sticks, umbrellas, tool handles
or the like
|
|
3
|
4405
|
Wood
wool; wood flour
|
|
4
|
4406
|
Railway
or tramway sleepers (cross-ties) of wood
|
|
5
|
4408
|
Sheets
for veneering, for plywood or laminated wood, and other wood, sawn
lengthwise, sliced or peeled, whether or not planed, sanded, spliced or
end-jointed, of a thickness not exceeding 6 mm [for match splints]
|
|
6
|
4409
|
Bamboo
flooring
|
|
7
|
4415
|
Packing
cases, boxes, crates, drums and similar packings of wood; cable-drums of
wood; pallets, box pallets and other load boards of wood; pallet collars of
wood
|
|
8
|
4416
|
Casks,
barrels, vats, tubs and other coopers’ products and parts thereof, of wood,
including staves
|
|
9
|
4417
|
Tools,
tool bodies, tool handles, broom or brush bodies and handles, of wood; boot
or shoe lasts and trees, of wood
|
|
10
|
4418
|
Bamboo
wood building joinery
|
|
11
|
4420
|
Wood
marquetry and inlaid wood; caskets and cases for jewellery or cutlery;
statuettes and ornaments of wood; wooden articles of furniture not falling in
Chapter 94
|
|
12
|
4421
|
Other
articles of wood (clothes hangers, spools, cops, bobbins, sewing thread reels
and the like of turned wood for textile machinery, match splints, pencil
slats, oars, paddles and rudders for ships/boats, parts of domestic
decorative articles used as tableware and kitchenware) [excluding: wood
paving blocks, articles of densified wood not elsewhere specified, parts of
domestic decorative articles used as tableware and kitchenware]
|
|
13
|
4502
00 00
|
Natural
cork, debacked or roughly squared, or in rectangular/square blocks, plates,
sheets or strip (including sharp-edged blanks for corks or stoppers)
|
|
14
|
4503
|
Articles
of natural cork such as corks and stoppers, shuttlecock cork bottom
|
|
15
|
4504
|
Agglomerated
cork (with or without binding substance) and articles of agglomerated cork
|
Effective
Date of Change
The reduced rates will
come into effect from 22nd September, 2025.
- For all wood and allied products, the
new 5% GST rate will apply on supplies made on or after this date.
Benefits of
the Rate Cut
1. Boost
to Traditional & Rural Industries
Many of the goods covered—such as bamboo, bagasse, jute boards, and wooden
handicrafts—are produced by MSMEs, artisans, and rural industries. The
tax cut will enhance their competitiveness.
2. Encouragement
of Eco-friendly Alternatives
Boards made from agricultural residues (like rice husk, bagasse, cotton stalk)
and bamboo joinery are sustainable substitutes for conventional materials.
Lower GST makes them more accessible.
3. Support
for Consumers & Middle-Class Households
Reduced rates on wooden kitchenware, furniture articles, and household goods
will bring direct savings for the common man.
4. Growth
in Exports & Value-added Industries
The rate cut improves cost efficiency for Indian manufacturers, enabling better
positioning in international markets.
Industry Outlook
Experts believe this move
will revive demand in the wood products sector, encourage formalization
of small units, and align with the government’s vision of promoting sustainable
development.
With raw material boards,
utility wood, bamboo products, and wooden household items now taxed at just 5%,
the wood sector is likely to witness increased demand, higher production,
and job creation across rural and semi-urban clusters.
Conclusion
The GST Council’s decision marks a major relief package for the wood sector,
balancing the interests of industry, artisans, and consumers. By
reducing tax burdens and promoting eco-friendly substitutes, the government has
taken a step towards making sustainable materials more affordable and
accessible.
Disclaimer: All the Information is based on the notification, circular advisory and order issued by the Govt. authority and judgement delivered by the court or the authority information is strictly for educational purposes and on the basis of our best understanding of laws & not binding on anyone.
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