What is GST? A Simple Guide

GST, or Goods and Services Tax, is an indirect tax applied to most goods and services. It replaced a web of older taxes with a single, tiered system, and it is charged as a percentage added on top of a product's base price.

The main GST slabs

Most items fall into one of four rates: 5%, 12%, 18% and 28%. Essentials are taxed lightly (or at 0%), while luxury and "sin" goods sit at the top of the range.

• 5% — everyday essentials and transport.
• 12% / 18% — most standard goods and services.
• 28% — luxury items and select categories.

How to add GST to a price

Multiply the base price by the rate. For ₹1,000 at 18%: 1,000 × 0.18 = ₹180 GST, so the total is ₹1,180. You can do this instantly with our GST calculator.

How to remove GST from a total

To work backwards from a GST-inclusive price, divide by (1 + rate/100). For ₹1,180 at 18%: 1,180 ÷ 1.18 = ₹1,000 base, leaving ₹180 of GST.

Why it matters for invoices

Showing the base amount, the GST charged, and the total separately keeps invoices compliant and transparent. If you bill clients, calculate the split before you send.