By Lukeron Lubricants · Last updated
Quick answer
Lubricants are classified under chapter 27 (heading 2710) or chapter 34 (heading 3403) of the tariff. The test is what the product is made of: a product with 70% or more petroleum oil goes under 2710, and one with less, or with a synthetic base, goes under 3403. Coolant and brake fluid have their own headings. The eight-digit code is set per product, so confirm it with your supplier and your accountant. Lukeron charges GST at 18% on its products.
Where lubricants usually sit in the tariff
| Product | Usual heading | Why |
|---|---|---|
| Mineral engine, gear, hydraulic and compressor oils | 2710 | 70% or more petroleum oil as the basic ingredient |
| Fully synthetic oils | 3403 | Synthetic base, not petroleum oil |
| Greases | 2710 or 3403 | Depends on the share of petroleum oil in the grease |
| Engine coolant and anti-freeze | 3820 | Anti-freezing preparations |
| Hydraulic brake fluid | 3819 | Prepared liquids for hydraulic transmission |
General guidance only. The eight-digit code is set per product. Confirm it with your supplier, your accountant and the current Customs Tariff.
If you buy or sell lubricants in India, you need an HSN code on every GST invoice. Many buyers search for the HSN code of engine oil, gear oil, hydraulic oil or grease and find different answers on different websites. This guide explains how lubricants are classified, why the code can differ between two similar-looking products, and what to check before you put a code on an invoice.
What an HSN code is
HSN stands for Harmonized System of Nomenclature. It is a numbering system for goods. The first six digits are the same in most countries. India's Customs Tariff adds two more digits, so the code used on Indian customs papers has eight digits. On a GST invoice, the code tells the tax office what the goods are.
Lubricants fall under chapter 27 or chapter 34
Most lubricants are classified under one of two chapters of the tariff.
- Chapter 27, heading 2710: petroleum oils. This heading covers mineral oils and also preparations that contain 70% or more petroleum oil by weight, with that oil as the basic ingredient.
- Chapter 34, heading 3403: lubricating preparations. This heading covers lubricants that contain less than 70% petroleum oil, and lubricants with a synthetic base.
So the deciding question is not the name on the pack. It is what the product is made of. A mineral-based engine oil is usually under 2710. A fully synthetic oil can fall under 3403. A grease can fall under either one, depending on how much petroleum oil it contains.
Coolant and brake fluid
Engine coolant and anti-freeze are usually classified under heading 3820, and hydraulic brake fluid under heading 3819. Both are different from lubricating oils, so a supplier that sells oil, coolant and brake fluid will show more than one heading on its invoices.
Why two similar products can have different codes
- The base oil is different: mineral, semi-synthetic or fully synthetic.
- The share of petroleum oil in the finished product is different, because of the additive package or the thickener in a grease.
- The product meets a different Indian standard, and the tariff has separate lines for some standards.
- Two sellers have classified the same product differently, and only one of them is right.
What the GST rate is
Lukeron charges GST at 18% on its products. The GST Council sets the rates and has changed them over the years, so check the current notification for any product you buy or sell. Do not copy a rate or a code from a website that does not show its date.
How to confirm the right HSN code
- Ask the supplier for the code of the exact product and check it against the Customs Tariff.
- Check the product data sheet for the base oil type and the make-up of the product.
- Ask your chartered accountant to confirm the code for each product you invoice.
- Use the same code on your quotation, your invoice and your e-way bill.
HSN codes when you export
The first six digits of the code are the same in most countries, so an importer abroad can match your product to their own tariff. The eight-digit Indian code goes on the shipping bill. The code on the commercial invoice, the packing list and the shipping bill should be the same. Our export buyer's checklist lists what a supplier needs from you.
Common mistakes
- Copying the code from a competitor or from a website without checking the product.
- Using one code for every product, including synthetic oils, greases and coolants.
- Mixing codes between the quotation and the invoice.
- Using an old GST rate after a notification has changed.