How to Calculate GST in India
The Goods and Services Tax (GST) is a destination-based, multi-stage tax levied on every value addition in India. Calculating GST depends on whether your quoted price is exclusive (pre-tax base price) or inclusive (retail price including tax).
GST Exclusive Calculation
GST Amount = (Base Price × GST Rate) / 100
Total Invoice = Base Price + GST Amount
GST Inclusive Calculation
GST Amount = Total - [Total × (100 / (100 + Rate))]
Base Amount = Total - GST Amount
Goods and Services Tax (GST) Slabs in India
| GST Slab | Type of Supply | Common Items / Services |
|---|---|---|
| 0% | Exempt Goods | Unpacked grains, fresh milk, vegetables, curd, bread |
| 5% | Basic Necessities | Packaged foods, domestic air travel, life-saving drugs |
| 12% | Standard Tier 1 | Processed food, computer hardware, business travel |
| 18% | Standard Tier 2 | IT software, marketing, consulting (SAC 9983), telecom |
| 28% | Luxury / Sin | Motor cars, luxury watches, tobacco, cement |
Frequently Asked Questions
How to calculate inclusive GST (Reverse GST formula)?
When price includes GST: GST Amount = Total Price - [Total Price × {100 / (100 + GST Rate)}]. Base Pre-Tax Price = Total Price - GST Amount. For example, for ₹118 at 18% GST: Base Price = ₹118 × (100/118) = ₹100, and GST Amount = ₹18.
How to calculate exclusive GST?
When price excludes GST: GST Amount = (Base Price × GST Rate) / 100. Total Invoice Price = Base Price + GST Amount. For example, for a base price of ₹1,000 at 18% GST: GST Amount = ₹180, Total = ₹1,180.
What is the difference between CGST, SGST, and IGST?
When seller and buyer are in the same Indian state (intra-state), tax is split equally between CGST (Central GST) and SGST (State GST). When they are in different states (inter-state), IGST (Integrated GST) applies at the full rate.
Which GST rate applies to IT, marketing, and consulting services?
Most professional services, digital marketing, software development, and management consultancy fall under SAC Code 9983 and are taxed at the 18% standard GST rate.