GST rates after GST 2.0
From 22 September 2025, India moved to a simpler GST structure. Most goods and services now fall into two main rates, 5% and 18%, with a special 40% rate for luxury and sin goods such as tobacco, aerated drinks and high-end cars. The old 12% and 28% slabs have largely been folded into these. A few special rates remain, like 3% on gold and silver and 0.25% on rough diamonds. Rates for specific items still vary, so check the rate for your HSN or SAC code.
Adding GST: GST = price × rate; total = price + GST
Removing GST: base = total ÷ (1 + rate); GST = total − baseWorked example
A very common mistake is removing GST by taking 18% off the total. On ₹1,180, 18% is ₹212.40, but the actual GST inside is ₹180. Always divide by (1 + rate).
CGST + SGST or IGST?
| Type of sale | Tax charged | Example at 18% |
|---|---|---|
| Within the same state (intra-state) | CGST + SGST, half each | 9% + 9% |
| To another state (inter-state) | IGST, full rate | 18% |
| Within a union territory | CGST + UTGST | 9% + 9% |
| Export of goods or services | Zero-rated (with LUT or IGST refund) | 0% |
Who needs to register?
Businesses must register for GST once yearly turnover crosses ₹40 lakh for goods or ₹20 lakh for services (₹20 lakh and ₹10 lakh in special-category states). Selling on e-commerce marketplaces usually requires registration regardless of turnover. Small businesses can consider the composition scheme, which charges a low flat rate on turnover but doesn't allow input tax credit.
Need to bill a customer? Create a proper GST invoice in the free GST invoice generator. Setting prices? The product pricing calculator includes GST in the final price.
Frequently asked questions
How do I calculate 18% GST on an amount?
Multiply by 0.18 for the GST, or by 1.18 for the total. ₹10,000 + 18% GST = ₹1,800 GST, ₹11,800 total.
How do I remove GST from a total?
Divide by (1 + rate). For 18%: ₹11,800 ÷ 1.18 = ₹10,000 base, so GST is ₹1,800.
What happened to the 12% and 28% GST rates?
Under GST 2.0 (from 22 September 2025), most items in those slabs moved to 5% or 18%, and some luxury goods to 40%. The options are kept here for older invoices.
What is the GST on restaurant food and bakery items?
Rates depend on the item and how it's sold: restaurant services and packaged or branded food can differ. Check the rate for your HSN/SAC code on the GST portal or with your accountant.
Official references: GST portal · CBIC – GST