Rate of tax of the composition levy
Rule 7 of the CGST Rules
Straight from CBIC
Official source, not a summary of a summary
Full text included
Read the exact words of the law yourself
Amendment history
See what changed, and when
Free, always
No login, no paywall, no book to buy
In one line
The composition rates: 0.5 per cent CGST for a manufacturer, 2.5 per cent for a restaurant, 0.5 per cent on taxable turnover for a trader, and 3 per cent for the section 10(2A) service scheme – each doubled once SGST is added, giving 1, 5, 1 and 6 per cent.
How this provision is built
The skeleton, clause by clause — useful when a notice cites a specific sub-clause.
The exact words of the law
1,352 characters, uneditedReproduced from the CBIC text. We explain it above — but you should always be able to read it yourself.
Read the full provision+
(2) of the Table below shall pay tax under section 10 at the rate specified in column
(3) of the said Table: – 1 [ TABLE Sl. No. Section under which composition levy is opted Category of registered persons Rate of tax
(1) (1A)
(2)
(3) 1. Sub-sections
(1) and
(2) of section 10 Manufacturers, other than manufacturers of such goods as may be notified by the Government half per cent. of the turnover in the State or Union territory 2. Sub-sections
(1) and
(2) of section 10 Suppliers making supplies referred to in clause
(b) of paragraph 6 of Schedule II two and a half per cent. of the turnover in the State or Union territory 3. Sub-sections
(1) and
(2) of section 10 Any other supplier eligible for composition levy under sub-sections
(1) and
(2) of section 10 half per cent. of the turnover of taxable supplies of goods and services in the State or Union territory 4. Sub-section (2A) of section 10 Registered persons not eligible under the composition levy under subsections
(1) and (2), but eligible to opt to pay tax under sub-section (2A), of section 10 three per cent. of the 2 [turnover of] supplies of goods and services in the State or Union territory. ]
What changed, and when
The amendment trail, newest first — because the version that applies to your case depends on the period.
2020-06-25 · Substituted
Substituted by Corrigendum G.S.R. 412(E), dated 25.06.2020.
2020-04-01 · Substituted
50/2020-CTdated
Substituted (w.e.f. 01.04.2020) vide Notification No. 50/2020-CT dated. 24.06.2020 for Sl. No. Category of registered persons Rate of tax (1) (2) (3) 1. Manufacturers, other than manufacturers of such goods as may be notified by the Government half per cent. of the turnover in the State or Union ter
Where this comes from
Text reproduced from the Central Board of Indirect Taxes and Customs, as available on 2026-09-05. The explanation and practice notes above are GSTZone’s own, written for this hub. If you spot anything out of date, tell us and we’ll fix it — this hub is checked daily against CBIC.
Reading is free. Getting it wrong isn’t.
Does this apply to your case, or not?
Reading the section is one thing. Knowing whether it bites on your facts, and what it costs if it does, is another. Send us the situation – we will tell you straight, and only take it on if we can genuinely help.
6+ years · 2,500+ GST registrations filed · Bhopal, serving all of India