Add or remove GST instantly · CGST + SGST + IGST breakdown · All slabs · Intra & inter-state
How GST Works in India
Goods and Services Tax (GST) is a unified indirect tax levied on the supply of goods and services across India. It replaced multiple cascading taxes like VAT, service tax, and excise duty. GST is collected at each stage of the supply chain, with the final burden falling on the end consumer.
GST Slabs — What Falls Where
- 0% (Exempt) — Essential food items (milk, eggs, vegetables, grains), healthcare services, education
- 5% — Packed food, footwear under ₹1,000, economy class tickets, household necessities
- 12% — Processed food, computers, mobile phones, business class tickets, non-AC restaurants
- 18% — Most services (IT, telecom, banking fees), restaurant food, personal care, electronic appliances
- 28% — Luxury goods, automobiles, tobacco, aerated beverages, casinos, gambling
CGST vs SGST vs IGST — What's the Difference?
- CGST (Central GST) — Collected by the Central Government on intra-state transactions. Always equal to SGST.
- SGST (State GST) — Collected by the State Government on intra-state transactions. Equal to CGST.
- IGST (Integrated GST) — Applied on inter-state transactions (between different states). Equal to CGST + SGST combined. Collected by Centre and distributed to states.
- Example: 18% GST on an intra-state sale = 9% CGST + 9% SGST. On inter-state = 18% IGST.
GST Registration — Who Needs It?
- Businesses with annual turnover exceeding ₹40 lakh (₹20 lakh for services, ₹10 lakh for special category states)
- Any business making inter-state sales regardless of turnover
- E-commerce sellers and aggregators
- Casual taxable persons and non-resident taxable persons
- Businesses registered under earlier indirect tax laws automatically needed to migrate
Frequently Asked Questions
How do I calculate GST on a MRP inclusive price?
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When a price already includes GST (GST-inclusive), use the "Remove GST" mode. Formula: Base Amount = MRP ÷ (1 + GST rate). Example: If the MRP is ₹11,800 and GST rate is 18%, the base amount = ₹11,800 ÷ 1.18 = ₹10,000. The GST amount = ₹11,800 − ₹10,000 = ₹1,800. This calculator handles this automatically — just select "Remove GST" mode.
Can I claim GST Input Tax Credit (ITC)?
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Yes, if you're a GST-registered business, you can claim Input Tax Credit (ITC) on GST paid on your purchases, which reduces your final GST liability. For example, if you paid ₹1,800 GST on inputs and collected ₹3,600 GST on outputs, your net GST payable to the government is only ₹1,800. ITC is not available for personal consumption, motor vehicles (in most cases), and certain specified goods and services.
What is the GST rate on services like IT, consulting, and freelancing?
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Most services in India attract 18% GST. This includes IT services, software development, consulting, marketing, legal services, accounting, and financial services. Healthcare services (hospital treatment, diagnostic labs), educational services, and services provided by RBI are exempt. Export of services is zero-rated — meaning no GST is charged but you can still claim ITC refunds.
What is the GST Composition Scheme?
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Small businesses with turnover under ₹1.5 crore (₹75 lakh for some states and services) can opt for the Composition Scheme. They pay a flat GST rate (1% for traders, 2% for manufacturers, 5% for restaurants) on turnover instead of the standard rates. The benefit is simplified compliance and lower rates. The downside: you cannot collect GST from customers, cannot claim ITC, and cannot make inter-state supplies.