GST Council | 25th Meeting | 18 January 2018

IGST Rate Change on 18 January 2018: Satellites and Launch Vehicles

At its 25th meeting on 18 January 2018, the GST Council recommended a concessional 5% integrated goods and services tax (IGST) treatment for specified goods required for launch vehicles, satellites and payloads, subject to the wording and conditions of the applicable notification.

Important distinction: The 18 January 2018 decision was a recommendation, not itself a tax notification. The historical rate shown below must not be treated as the automatically applicable rate for transactions in 2026. Always check the latest amended tariff notification, product classification, recipient and conditions before invoicing.

What was recommended?

The original GST Council update identified goods falling under Chapter 88 or other relevant tariff chapters, including satellites, payloads and scientific or technical goods required for space-launch projects. The proposed concessional IGST rate was 5%, compared with the 18% rate stated in the original announcement for the described supplies.

Tariff chapter	Goods described in the 2018 recommendation	Earlier rate stated	Recommended rate
Chapter 88 or any other applicable chapter	Satellites and payloads; scientific and technical instruments, apparatus, equipment, accessories, parts, components, spares, tools, mock-ups and modules; raw materials and consumables required for launch vehicles, satellites and payloads.	18% IGST	5% IGST, subject to the notified entry and eligibility conditions.

Legal framework for IGST rates

Section 5(1) of the IGST Act, 2017

Levy and collection: Section 5(1) provides for the levy of integrated tax on inter-State supplies of goods or services or both, subject to its statutory exclusions and the rate notified by the Central Government on the recommendations of the GST Council. Imports are governed by the applicable customs and IGST provisions.

Section 11 of the IGST Act, 2017

Exemptions: Section 11 empowers the Central Government, on the GST Council's recommendations, to grant exemptions from integrated tax by notification in the circumstances provided by law. A reduced rate and a full exemption are legally distinct treatments.

Tariff classification and notification conditions

The description of goods, relevant Customs Tariff heading, specified end-use, recipient and any supporting certificate or declaration must be checked against the legally operative notification. Merely supplying goods to the space sector does not by itself establish entitlement to a concessional rate.

How the January 2018 recommendation was implemented

The CBIC issued several Integrated Tax (Rate) notifications dated 25 January 2018. In particular, Notification No. 07/2018-Integrated Tax (Rate) amended the principal rate notification No. 1/2017-Integrated Tax (Rate), while Notification No. 09/2018-Integrated Tax (Rate) also amended that principal notification. The relevant amended schedule and exact entry should be consulted to establish the scope and commencement of a concession.

See the CBIC Integrated Tax (Rate) notifications index and the GST Council's archived press releases for 18 January 2018. The official GST Council meeting archive also identifies the 25th meeting held on that date.

Practical checks before applying an IGST concession

Identify the actual goods and correct HSN or tariff heading.
Check whether the supply is inter-State, an import, or otherwise subject to a special statutory treatment.
Read the latest consolidated rate entry, including amendments after January 2018.
Verify any end-use, purchaser, documentary or certification requirements.
Preserve purchase orders, declarations, invoices and evidence supporting eligibility.

Frequently asked questions

Did the IGST rate change automatically on 18 January 2018?

No. The GST Council made recommendations on that date; legal effect depends on the relevant notification and its commencement provisions.

Does every satellite-related product qualify for 5% IGST?

No. Eligibility depends on the precise notified description and conditions. General use in the space industry is not sufficient on its own.

Can the 2018 rate be used for a current supply?

Only if the currently applicable law and notifications support that treatment. The table above records the historical 2018 recommendation, not a verified current rate.

Official sources and related reading

Editorial review: 21 October 2026. This article explains a historical rate recommendation and general statutory principles; it does not replace checking the current Gazette notifications or professional advice on a specific transaction.