HSN Chapter 54: Man-Made Filaments & Synthetic Fabrics GST Rates 2026
🔍 Search Specific HSN Codes & GST Rates
Find exact GST rates for 1,195+ HSN codes instantly
🚀 Use Complete HSN Rate Finder🎉 MAJOR GST RELIEF for Synthetic Textile Industry SEPTEMBER 22, 2025
Historic Uniform 5% GST Structure Across Chapter 54:
In a game-changing move for India's textile sector, GST 2.0 has brought ALL man-made filament products under a uniform 5% GST rate effective September 22, 2025. Previously taxed yarn at 12-18% has now been drastically reduced to just 5%, creating massive savings for the entire textile value chain.
Revolutionary Tax Benefits in Chapter 54:
- 🧵 Synthetic Yarn: Reduced from 18% to 5% ↓ 72% RATE CUT!
- 🌟 Artificial (Rayon) Yarn: Down from 18% to 5% GST
- ✂️ Sewing Thread: Reduced from 12% to 5% GST
- 📐 Woven Fabrics: Maintained at 5% GST (unchanged)
- 🏭 Complete Value Chain: Now uniformly taxed at 5% - End of inverted duty structure!
HSN Chapter 54 encompasses man-made filaments including synthetic (polyester, nylon, acrylic) and artificial (rayon, viscose) filament yarns, monofilaments, strips, and woven fabrics. These modern textile materials form the backbone of India's ₹3 lakh crore garment export industry and rapidly growing technical textile manufacturing sector.
Under the transformative GST 2.0 reforms effective September 22, 2025 and continuing through 2026, the government has implemented a revolutionary uniform 5% GST across the entire man-made filament spectrum, eliminating the complex multi-tier structure and removing the long-standing inverted duty problem that plagued textile manufacturers.
⚙️ GST 2026 Rate Structure for Chapter 54
🎯 SIMPLIFIED UNIFORM RATE: Complete Chapter 54 at 5% GST!
All products under HSN Chapter 54 now attract only 5% GST:
- 🔵 5% GST: Sewing thread (HSN 5401) - Previously 12%
- 🔵 5% GST: Synthetic yarn - Polyester, nylon, acrylic (HSN 5402) - Previously 18%
- 🔵 5% GST: Artificial yarn - Rayon, viscose (HSN 5403) - Previously 18%
- 🔵 5% GST: Monofilaments & strips (HSN 5404-5405) - Previously 18%
- 🔵 5% GST: Retail yarn (HSN 5406) - Previously 18%
- 🔵 5% GST: Woven fabrics (HSN 5407-5408) - Maintained
📊 Why This Change is Revolutionary for Textile Industry:
- ✅ End of Inverted Duty: No more paying higher tax on inputs than outputs
- ✅ Simplified Compliance: Single 5% rate eliminates classification confusion
- ✅ Cost Reduction: Yarn costs down by 13% (from 18% to 5%)
- ✅ Export Boost: Indian textiles now globally competitive
- ✅ ITC Smoothening: Uniform rates improve cash flow
✂️ Sewing Thread of Man-Made Filaments (HSN 5401)
Sewing Thread - Now at 5% GST ↓ DOWN FROM 12%
Synthetic and artificial sewing thread now enjoys the same 5% concessional rate as other textile inputs, eliminating the previous 12% burden on garment manufacturers.
HSN 5401 - Sewing Thread
| HSN Code | Description | GST 2026 Rate | Previous Rate | Use |
|---|---|---|---|---|
| 5401 10 | Sewing thread of synthetic filaments | 5% | 12% | Garment manufacturing |
| 5401 20 | Sewing thread of artificial filaments | 5% | 12% | Textile stitching |
🧶 Synthetic Filament Yarn (HSN 5402)
🎉 MASSIVE TAX CUT: Polyester, Nylon Yarn Now 5% ↓ FROM 18%
All synthetic filament yarns including polyester DTY/FDY/POY, nylon, acrylic, and spandex have seen a dramatic 13 percentage point reduction from 18% to just 5% GST, making Indian synthetic yarn globally competitive and boosting domestic manufacturing.
HSN 5402 - Synthetic Filament Yarn (Not for Retail)
| HSN Code | Description | GST 2026 Rate | Previous Rate | Common Names |
|---|---|---|---|---|
| 5402 11 | Nylon or other polyamides, high tenacity yarn | 5% | 18% | Nylon 6, Nylon 66 |
| 5402 19 | Other nylon/polyamide yarn | 5% | 18% | Nylon textured yarn |
| 5402 20 | Polyester high tenacity yarn | 5% | 18% | PET industrial yarn |
| 5402 31 | Textured polyester yarn | 5% | 18% | Polyester DTY, FDY |
| 5402 32 | Other polyester yarn, single, untwisted/twist ≤50 | 5% | 18% | Polyester POY |
| 5402 33 | Other polyester yarn, single, twist >50 | 5% | 18% | Twisted polyester |
| 5402 34 | Polyester yarn, multiple/cabled | 5% | 18% | Multi-ply polyester |
| 5402 44 | Elastomeric yarn (spandex) | 5% | 18% | Lycra, spandex, elastane |
| 5402 45-49 | Other synthetic filament yarn | 5% | 18% | Acrylic, PP, PE yarns |
| 5402 51-59 | Polypropylene & other synthetic yarn | 5% | 18% | PP yarn, specialty synthetics |
🌟 Artificial Filament Yarn (HSN 5403)
Rayon/Viscose Yarn - Down to 5% GST ↓ FROM 18%
Artificial filament yarns (rayon, viscose) also benefit from the massive 13-point GST reduction, bringing premium natural-feel synthetic textiles within affordable reach.
HSN 5403 - Artificial Filament Yarn (Rayon/Viscose)
| HSN Code | Description | GST 2026 Rate | Previous Rate | Type |
|---|---|---|---|---|
| 5403 10 | Artificial filament yarn, high tenacity (viscose) | 5% | 18% | Rayon industrial yarn |
| 5403 31 | Viscose rayon yarn, single, untwisted/twist ≤120 | 5% | 18% | Rayon textile yarn |
| 5403 32 | Viscose rayon yarn, single, twist >120 | 5% | 18% | Twisted rayon |
| 5403 33 | Viscose rayon yarn, multiple/cabled | 5% | 18% | Multi-ply rayon |
| 5403 41-49 | Cellulose acetate & other artificial yarn | 5% | 18% | Acetate, cuprammonium yarn |
🔧 Synthetic Monofilament, Strips & Technical Products (HSN 5404-5405)
HSN 5404 - Synthetic Monofilament & Strips
| HSN Code | Description | GST 2026 Rate | Previous Rate | Application |
|---|---|---|---|---|
| 5404 11 | Elastomeric monofilament | 5% | 18% | Elastic products |
| 5404 12 | Other synthetic monofilament ≥67 decitex | 5% | 18% | Fishing lines, technical use |
| 5404 19 | Other synthetic monofilament | 5% | 18% | Industrial filaments |
| 5404 90 | Synthetic strip & artificial straw | 5% | 18% | Rope, packaging materials |
HSN 5405 - Artificial Monofilament
| HSN Code | Description | GST 2026 Rate | Previous Rate | Use |
|---|---|---|---|---|
| 5405 00 | Artificial monofilament, strip & straw | 5% | 18% | Technical applications |
🧵 Man-Made Filament Yarn for Retail (HSN 5406)
HSN 5406 - Synthetic/Artificial Yarn (Retail Packaging)
| HSN Code | Description | GST 2026 Rate | Previous Rate | Market |
|---|---|---|---|---|
| 5406 00 | Man-made filament yarn, put up for retail sale | 5% | 18% | Consumer knitting/embroidery |
📐 Woven Fabrics of Synthetic Filaments (HSN 5407)
✅ Woven Fabrics Maintain 5% GST - Now Aligned with Entire Value Chain!
Woven synthetic fabrics continue at 5% GST (unchanged), but the real win is that now yarn is also at 5%, eliminating the inverted duty structure where manufacturers paid 18% GST on yarn but collected only 5% on fabric output.
HSN 5407 - Woven Fabrics of Synthetic Filament Yarn
| HSN Code | Description | GST 2026 Rate | Previous Rate | Fabric Type |
|---|---|---|---|---|
| 5407 10 | Woven fabrics, high tenacity yarn (nylon/polyester) | 5% | 5% | Industrial fabrics |
| 5407 20 | Woven fabrics, strip/similar materials | 5% | 5% | Technical textiles |
| 5407 30 | Fabrics of yarns of different colors (checks, stripes) | 5% | 5% | Shirting, dress materials |
| 5407 41 | Polyester fabrics, unbleached/bleached | 5% | 5% | Base polyester fabric |
| 5407 42 | Polyester fabrics, dyed | 5% | 5% | Colored polyester cloth |
| 5407 43 | Polyester fabrics, yarn of different colors | 5% | 5% | Polyester checks, plaids |
| 5407 44 | Polyester fabrics, printed | 5% | 5% | Printed polyester textiles |
| 5407 51-54 | Textured polyester fabrics (all finishes) | 5% | 5% | Polyester crepe, georgette |
| 5407 61-69 | Fabrics ≥85% non-textured polyester filaments | 5% | 5% | Pure polyester fabrics |
| 5407 71-74 | Fabrics ≥85% synthetic filaments (other than polyester) | 5% | 5% | Nylon, acrylic fabrics |
| 5407 81-84 | Synthetic fabrics (mixed compositions) | 5% | 5% | Blended synthetic fabrics |
| 5407 91-94 | Other synthetic woven fabrics | 5% | 5% | Specialty synthetics |
📐 Woven Fabrics of Artificial Filaments (HSN 5408)
HSN 5408 - Woven Fabrics of Artificial Filament Yarn (Rayon)
| HSN Code | Description | GST 2026 Rate | Previous Rate | Rayon Fabric Type |
|---|---|---|---|---|
| 5408 10 | Rayon fabrics, high tenacity yarn | 5% | 5% | Industrial rayon |
| 5408 21-24 | Rayon fabrics ≥85% artificial filaments (all finishes) | 5% | 5% | Pure rayon textiles |
| 5408 31-34 | Rayon fabrics, mixed compositions (all finishes) | 5% | 5% | Rayon blend fabrics |
🧮 GST 2026 Calculator for Chapter 54 Items
Man-Made Filament GST Calculator - 2026 Uniform 5% Rate
Calculate GST for all synthetic/artificial textile products at new reduced rate:
CGST = (Product Value × 5%) ÷ 2 = Product Value × 2.5%
SGST = (Product Value × 5%) ÷ 2 = Product Value × 2.5%
Total GST = CGST + SGST = Product Value × 5%
Final Amount = Product Value + Total GST
📋 GST 2026 Compliance Points for Chapter 54
🏭 Yarn Manufacturers & Spinners
- Uniform 5% GST on all yarn types
- Massive 13-point reduction from 18%
- Export competitiveness improved
- Working capital relief through lower tax
- ITC alignment with fabric sector
📐 Fabric Weavers & Processors
- No more inverted duty structure
- 5% GST on both input yarn and output fabric
- Smooth ITC flow - No blockage
- Improved cash flow management
- Simplified compliance
👔 Garment Manufacturers
- 5% GST on fabric inputs (unchanged)
- 5% on sewing thread (down from 12%)
- 7% cost savings on thread purchases
- Enhanced export margins
- Competitive pricing power
🛍️ Textile Traders & Retailers
- Single 5% rate - Easy compliance
- No classification confusion
- Uniform invoicing across products
- Reduced tax liability
- Improved margins
🎯 GST 2026 Sector Impact Analysis
Revolutionary Benefits for Synthetic Textile Industry
- 💰 Cost Reduction: 13% GST cut on yarn saves ₹13 on every ₹100 of yarn purchased
- 📊 End of Inverted Duty: No more paying higher GST on inputs than outputs
- 💼 Employment Boost: Lower costs enable expansion and job creation
- 📈 Export Growth: Indian synthetics now match Chinese prices globally
- 🏭 Make in India: Attracts investment in domestic textile manufacturing
- 🔄 Cash Flow: Uniform rates eliminate ITC blockages
Consumer & Market Advantages
- 👕 Affordable Clothing: Cost savings passed to consumers
- 🧵 Quality Products: Premium synthetic textiles more accessible
- 🌟 Innovation: Lower tax burden encourages R&D in technical textiles
- ♻️ Sustainability: Modern recycled polyester fabrics affordable
- 🛍️ Variety: Expanded product ranges at competitive prices
❓ Frequently Asked Questions (FAQs) - HSN Chapter 54
Answer: Yes! This is a confirmed and revolutionary change. Effective September 22, 2025, ALL synthetic filament yarns (HSN 5402) including polyester DTY/FDY/POY, nylon, acrylic, and spandex have been reduced from 18% to 5% GST.
This represents a massive 13 percentage point reduction that will save the industry thousands of crores annually and make Indian synthetic yarn globally competitive.
Answer: The 12% GST slab has been completely eliminated under GST 2.0. Sewing thread of man-made filaments (HSN 5401) that was previously at 12% is now reduced to 5% GST, bringing it in line with the rest of the textile value chain.
This benefits garment manufacturers significantly as sewing thread is a high-volume consumable in apparel production.
Answer: Yes, absolutely! Under GST 2.0 effective September 22, 2025, ALL products under HSN Chapter 54 attract uniform 5% GST:
- Sewing thread - 5% (was 12%)
- Synthetic yarn - 5% (was 18%)
- Artificial (rayon) yarn - 5% (was 18%)
- Monofilaments & strips - 5% (was 18%)
- Woven fabrics - 5% (unchanged)
This uniform structure eliminates all compliance confusion and inverted duty problems.
Answer: Previously, the textile sector suffered from inverted duty structure where:
- OLD: Yarn taxed at 18%, but fabric at 5% - Manufacturers paid 18% GST on inputs but collected only 5% on outputs
- Problem: Excess ITC accumulated, blocking working capital
- NOW: Both yarn and fabric at 5% - Perfect alignment eliminates ITC accumulation
Result: Smooth cash flow, no refund delays, improved profitability for manufacturers.
Answer: Yes! Registered businesses can claim full Input Tax Credit on 5% GST paid on synthetic yarn when:
- ✅ Yarn is used for manufacturing taxable supplies (fabrics, garments)
- ✅ Proper GST invoices maintained
- ✅ Business is registered and GST-compliant
The beauty now is that with uniform 5% rates, ITC flows smoothly without accumulation or refund hassles.
Answer: Yes! Artificial filament yarn including rayon/viscose (HSN 5403) also enjoys the reduced 5% GST rate (down from 18%).
This applies to all rayon products:
- Viscose rayon yarn
- Cellulose acetate yarn
- All rayon woven fabrics (HSN 5408)
Answer: The savings are substantial:
- On Yarn: 13% cost reduction (from 18% to 5%) = ₹13 saved per ₹100 of yarn
- On Sewing Thread: 7% reduction (from 12% to 5%) = ₹7 saved per ₹100
- Industry-wide: Estimated ₹5,000+ crore annual benefit to textile sector
For a garment manufacturer buying ₹1 crore worth of polyester yarn annually, this means ₹13 lakh direct GST savings!
Answer: Yes! Synthetic monofilament (HSN 5404) including fishing lines, industrial filaments, and technical products now attract 5% GST (reduced from 18%).
This benefits fishing equipment manufacturers, technical textile producers, and industrial users significantly.
Answer: The new uniform 5% GST rate structure for man-made filaments became effective from September 22, 2025 under the GST 2.0 reforms announced by the GST Council.
All transactions from this date onwards attract the new reduced rates. The changes continue through 2026 and beyond.
Answer: Yes! All woven synthetic fabrics (HSN 5407) and artificial fabrics (HSN 5408) attract uniform 5% GST regardless of finish:
- Unbleached/bleached - 5%
- Dyed (solid colors) - 5%
- Yarn-dyed (checks, plaids, stripes) - 5%
- Printed fabrics - 5%
No classification confusion - all finishes uniformly taxed at 5%.
🔗 Explore Related HSN Chapters
🚀 Popular Services
🏢 Business Registration
Start your business legally
Need Expert Help?
We're here to assist you with