What tax category does an optical module belong to

Optical modules are classified under specific HS/HSN codes, with GST rates ranging from 5% to 18% depending on the type and use of the product.

HS Codes for Optical Modules

Optical modules and related fiber optic products are classified under the Harmonized System (HS) for international trade. Common HS codes include:

• 8517.62 (HTS 8517.62.0090 for the U.S.) – Fiber optic transceivers used for reception, conversion, and transmission of data .
• 8517.70 (HTS 8517.70.0000) – Optical sub-assemblies such as TOSA (Transmitter Optical Sub-Assembly) and ROSA (Receiver Optical Sub-Assembly), .
• 8544.70 (HTS 8544.70.0000) – Sheathed fiber optic cables . These codes are used globally to determine customs duties, facilitate smooth import/export processes, and ensure accurate tariff application . The final classification may vary depending on the customs authority in each country.

HSN Codes and GST Rates in India

Under GST 2.0 reforms (effective September 22, 2025), optical modules fall under HSN Chapter 90, which covers optical, medical, and precision instruments . The GST rates for optical products are:

• 0% GST – Exempt items, typically life-saving medical devices.
• 5% GST – Essential optical goods, including contact lenses and spectacle lenses .
• 18% GST – Standard rate for other optical equipment, including most optical modules and fiber optic components .
• 40% GST – Luxury or non-essential optical items (rarely applicable to standard optical modules). This simplified 4-rate structure replaced the previous 12% slab, ensuring easier compliance and clearer categorization for businesses in the optical sector .

Practical Implications

• Importers/exporters must identify the correct HS code to calculate duties accurately and avoid customs delays .
• GST compliance requires using the appropriate HSN code to determine the correct tax rate for invoicing and input tax credit claims .
• Subcategories like transceivers, sub-assemblies, and cables may have different rates, so precise classification is essential for cost management and regulatory compliance . By using the correct HS/HSN codes and understanding the applicable GST rates, businesses can ensure smooth customs clearance, accurate taxation, and optimized supply chain operations.