Drones Get GST Relief: Commercial UAV To Attract 5% Tax; Defence Exempted

The GST Council has approved the simplification of the tax structure and slashed the taxes on commercial drones to 5%. In addition, the government had also exempted military drones, flight motion simulators, high-performance batteries and communication devices.

The 5% uniform GST rate for commercial drones is a relief for the industry in contrast to its inconsistent and complex structure earlier. The drones that were integrated with cameras earlier attracted 18% GST rate, while the drones without integrated cameras were taxed at 5%. Additionally, the personal and recreational drones were taxed up to 28%.

The difference in taxes not only created a distortion in the pricing for the drones but also created hurdles for the manufacturers and buyers.

According to the Drone Federation of India, this move will support the growth of India's drone ecosystem. "A landmark step that recognises drones as both an economic opportunity and a strategic necessity for India," it said in a statement.

The move is expected to accelerate adoption of drones across industries and strengthen India’s positioning in both commercial applications and defence modernisation.

The GST Council on Wednesday decided on proposals including restructuring tax slabs from four at present to only two — 5% and 18%.

The revisions in GST rates on goods and services, excluding certain tobacco products, will come into force on September 22, 2025. For specific items like cigarettes, chewing tobacco, and bidi, existing rates will continue to apply until a later date.