How to calculate GST
There are two common jobs. If you know the price before tax, you add GST to it. If you have a bill amount that already includes GST, you work backwards to find the original price and the tax inside it.
Remove GST: Price = Total × 100 ÷ (100 + Rate) For a sale within the same state, GST is split equally into CGST (to the Centre) and SGST (to the state). For a sale to another state, the whole amount is IGST.
Worked example
GST rates in India
The GST Council's reform, often called GST 2.0, came into force on 22 September 2025. It replaced the old 12% and 28% slabs with a simpler structure:
| Rate | Typically applies to |
|---|---|
| 0% (exempt) | Fresh food, milk, Indian breads, individual life and health insurance |
| 5% | Everyday essentials, medicines and medical devices, many food products |
| 18% | Most goods and services, including small cars, electronics and most professional services |
| 40% | Luxury and sin goods, such as large cars and gambling-related services |
| 3% and 0.25% | Special rates for gold and jewellery, and rough diamonds |
Rates depend on the exact HSN or SAC code of a product or service. Always check the official rate for your item on the CBIC GST portal before you invoice.
Frequently asked questions
What is the difference between CGST, SGST and IGST?
CGST and SGST are charged together on sales within one state, each at half the GST rate. IGST is charged on sales from one state to another, at the full rate. The total tax is the same.
How do I remove 18% GST from a price?
Divide the GST-inclusive amount by 1.18. For example, ₹1,180 ÷ 1.18 = ₹1,000, so the GST inside it is ₹180. Choose 'Remove GST' above to do this automatically.
What happened to the 12% and 28% GST slabs?
They were removed on 22 September 2025. Most items that were at 12% moved to 5%, and most items at 28% moved to 18%. Luxury and sin goods moved to the new 40% rate.
Who needs to register for GST?
Businesses selling goods need to register if their yearly turnover is over ₹40 lakh (₹20 lakh in some states), and service providers over ₹20 lakh (₹10 lakh in some states). Some businesses, such as online sellers, must register whatever their turnover.