Microlesson · 5-min read

Goods Exempt from Tax (Illustrative List)

# Goods Exempt from GST — Indicative Examples

Under GST, day-to-day common-man items are kept in the exempt basket. A small indicative list:

## Conceptual takeaways

Exempt goods generally cover unprocessed essentials, fresh produce, symbolic/national items, and traditional, low-margin items.
'Exempt' here is wholly exempt — no GST collected, no ITC on inputs used to make them.

Worked example

### Example 1

Manufacturer of plastic bangles (3926) purchases plastic granules with 18% GST. Output is exempt → ITC on granules must be reversed under Sec 17.

Claiming ITC on inputs/input services used exclusively for making exempt goods.
Confusing 'exempt' with '0% rated' (zero-rated supply, which is exports/SEZ — these allow ITC; exempt does not).

Reference: — Notification No. 2/2017-Central Tax (Rate) and amendments

Now that you've read this — what's next?

Move from understanding → mastery in 3 clicks. Each option below picks up from this lesson's topic.