GST on fertilizers, pesticides and seeds, for the shop counter

A fertilizer, seed and pesticide shop sells under three GST rates from one counter, often on one bill. A farmer buys a packet of cotton seed at 0%, two bags of DAP at 5% and a bottle of insecticide at 18%, and the bill has to get all three right. That is where most mistakes start.

This guide covers the rates as they stand in September 2026, the HSN codes you will see most, and the errors that show up later as a mismatch in GSTR-1. It is not tax advice. Rates change and a product’s exact composition can change its classification, so check anything unusual with your CA.

The three rates on an agri-input counter

You can look up 695 individual products, brand by brand, in the free GST and HSN finder. Those are the codes and rates AgroPay loads into a new shop.

What changed in September 2025

GST rates were rationalised from 22 September 2025. For agri-input shops the practical changes were two. Several bio-pesticides and micronutrients covered by the Fertiliser Control Order moved from 12% to 5%, and there is no longer a 12% slab for the products most shops stock. Finished fertilizers stayed at 5%, seeds stayed nil-rated, and chemical pesticides stayed at 18%.

If your product master still shows 12% against a bio-product or a micronutrient, it is almost certainly out of date. Check it against the current notification before the next bill.

Most agri inputs are sold at MRP

A 50 kg bag of DAP printed at ₹1,350 is sold for ₹1,350. The GST is already inside that price. So the bill must split ₹1,350 into a taxable value and the tax, not add 5% on top.

For one bag at 5%:

• Taxable value = 1,350 × 100 ÷ 105 = ₹1,285.71
• GST = 1,350 − 1,285.71 = ₹64.29
• Inside your state that is CGST ₹32.15 and SGST ₹32.14

Adding 5% on top of the MRP instead would charge the farmer ₹1,417.50, which is above MRP. Taking it out the wrong way round shows up as tax paid on a value you never received.

The mistakes that surface at return time

One rate for the whole bill. A mixed bill of seed, fertilizer and pesticide needs tax worked out per line, then grouped by HSN and rate. A calculator total with 18% applied to everything overcharges the farmer on the seed and fertilizer.

Seeds left out of the return. Nil-rated sales still belong in GSTR-1, in the nil-rated and exempt table. Leaving them out makes your turnover look smaller than your bank credits.

IGST charged as CGST and SGST. When a farmer or dealer from another state buys and the goods go there, the place of supply is the other state and the tax is IGST. A shop near a state border meets this more often than it expects.

A B2B bill without the buyer’s GSTIN. If the buyer gives a GSTIN, it must be on the bill, and the bill goes in the B2B table so the buyer can claim the credit.

Rounding each bill differently. The amount collected is rounded to the rupee, and 50 paise and above rounds up. If the screen rounds one way and the printed bill another, the day’s total stops matching the cash.

How AgroPay handles this

AgroPay sets the rate from the product category when you add a product (seed 0%, fertilizer 5%, pesticide 18%) and ships a starter list where bio-pesticides, micronutrients and sprayers already carry their own rates. Every line on a bill backs the tax out of the MRP, groups it by HSN and rate on the printed bill, switches to IGST when the place of supply is another state, and rounds the total half-up. At month end those same bills build the GSTR-1 file, including the nil-rated table.

See how GST billing works in AgroPay.