Updated 21 October 2026 · By Ashok Sachdev · Sources: CGST Act sections 2(74), 8 and 17(5)(h) and Schedule I; CBIC Circulars 92/11/2019 and 243/37/2024; Notification 9/2025-Central Tax (Rate). Not tax advice; confirm with your CA.
Quick answer
A Diwali gift hamper sold at one price is a mixed supply, taxed at the highest GST rate of any item in it: add one 18% or 40% item and the whole price takes that rate. Free gifts are not sales, but input tax credit on them is blocked. Staff gifts up to ₹50,000 a year are not supply.
Diwali falls on 8 November this year, and the weeks before it bring three GST questions to every shop counter: how to bill a hamper, how to treat gift vouchers, and what happens to the tax on gifts you give staff and customers. Here is each one with worked numbers.
In short
- Hamper at one price: a mixed supply, taxed at the highest rate among its items (CGST Act, section 8(b)).
- Same items priced separately: not a mixed supply. Each line takes its own rate.
- Gift vouchers: selling a voucher is neither a supply of goods nor services. GST applies when it is redeemed against goods (Circular 243/37/2024).
- Free gifts to customers: not a supply, but input tax credit on those goods is blocked (section 17(5)(h)).
- Buy one get one: not a free gift. GST on the price charged, and input credit stays (Circular 92/11/2019).
- Gifts to staff: up to ₹50,000 per employee per financial year is not a supply (Schedule I).
Selling gift hampers: the mixed supply rule
The GST law uses a Diwali-style hamper as its own example. Section 2(74) of the CGST Act says:
"A supply of a package consisting of canned foods, sweets, chocolates, cakes, dry fruits, aerated drinks and fruit juices when supplied for a single price is a mixed supply. Each of these items can be supplied separately and is not dependent on any other. It shall not be a mixed supply if these items are supplied separately."
Section 8(b) then says a mixed supply "shall be treated as a supply of that particular supply which attracts the highest rate of tax". So the rate of the costliest-taxed item decides the rate of the whole hamper.
GST rates of common hamper items
Rates from Notification 9/2025-Central Tax (Rate) (in force from 22 September 2025) and its exemption twin, Notification 10/2025, checked on 21 October 2026 together with the later amendments 19/2025 and 01/2026.
| Item | HSN | GST |
|---|---|---|
| Cashew, almonds, pista (dry fruits) | 0801 / 0802 | 5% |
| Chocolates | 1806 | 5% |
| Sweets (mithai), namkeen | 2106 | 5% |
| Biscuits, cookies, cakes | 1905 | 5% |
| Ceramic mugs, plates, crockery | 6911 / 6912 | 5% |
| Candles | 3406 | 5% |
| Earthen diyas | 6912 | Nil |
| Firecrackers | 3604 | 18% |
| Perfume, deodorant | 3303 / 3307 | 18% |
| Aerated drinks with added sugar | 2202 10 | 40% |
For anything else in your hamper, look it up in the HSN and GST rate finder.
Worked example: one can changes the whole bill
EXAMPLE figures. A hamper of kaju, chocolates, namkeen and two clay diyas sells for ₹1,050, including GST.
| How you bill it | Rate applied | Taxable value | GST |
|---|---|---|---|
| Hamper of 5% and nil items, one price | 5% (highest in the box) | ₹1,000.00 | ₹50.00 |
| Same hamper plus a can of cola, still ₹1,050 at one price | 40% on everything | ₹750.00 | ₹300.00 |
| Hamper ₹950 and cola ₹100 as two lines on one bill | 5% and 40% separately | ₹904.76 + ₹71.43 | ₹45.24 + ₹28.57 = ₹73.81 |
At the same ₹1,050 selling price, the single-price hamper with a cola leaves you ₹226 less in hand than billing the cola separately. A box of crackers or a perfume does the same at 18%. Before you fix the hamper price, check the rate of every item in it, or price the high-rate item on its own line.
The basket, box and wrapping are part of packing the hamper, not separate goods. A composite supply, such as goods with their packing, follows the rate of the main supply under section 8(a). If you are unsure whether a hamper is mixed or composite, ask your CA before printing price tags.
Gift vouchers and gift cards sold at Diwali
CBIC Circular 243/37/2024-GST (31 December 2024) settled this: "the transactions in voucher themselves cannot be considered either as a supply of goods or as a supply of services. However, supply of underlying goods and/or services, for which vouchers are used as consideration or part consideration, may be taxable under GST."
- When you sell a ₹2,000 voucher: no GST is charged on the voucher. Record the money received as owed to the customer.
- When it is redeemed: make a normal GST bill for the goods at their own rates, with the voucher shown as payment.
- If it is never used: the same circular says the unredeemed amount (breakage) is not taxable, because no goods were supplied.
RichPOS has gift vouchers built in: you issue a voucher, print the slip, and the cashier checks the code at the counter when it is redeemed. See gift voucher billing.
Free gifts and offers for customers
CBIC Circular 92/11/2019-GST covers sales promotion schemes:
| Offer | GST on the offer | Input tax credit |
|---|---|---|
| Free gift or sample with no consideration | Not a supply, so no GST | Blocked on those goods (section 17(5)(h)); reverse it if already claimed |
| Buy one get one free | Not a free supply: two items sold for one price, taxed under section 8 | Allowed |
| Discount shown on the bill ("buy more, save more") | GST on the price after discount | Allowed |
Section 17(5)(h) blocks credit on "goods lost, stolen, destroyed, written off or disposed of by way of gift or free samples". If you hand out boxes of sweets from your own stock as a thank-you to customers, the input credit you took when buying them has to be reversed.
A "free" item given only with a purchase, such as a diya with every bill above ₹500, is closer to the buy-one-get-one case, because the customer pays for the bill that includes it. Confirm the treatment with your CA before you print the offer. Discounts in detail: GST on discounts and how to show them on a bill.
