GST Calculator

What changed on 22 September 2025

The 56th GST Council, meeting on 3 September 2025, did the thing everyone had asked for since 2017: it collapsed the rate structure. From 22 September 2025 the 12% and 28% slabs were withdrawn for almost everything. What is left is a genuinely simple ladder — 0%, 5%, 18%, and a punitive 40% for luxury and sin goods. Small special rates survive for precious metals: 3% on gold, silver and jewellery, and 0.25% on rough diamonds.

Most items in the old 12% bucket fell to 5%. Most items in the old 28% bucket fell to 18%. That is why cement, air conditioners, televisions of every size, dishwashers, small cars and motorcycles up to 350cc all got noticeably cheaper overnight, while aerated drinks, large SUVs, bikes above 350cc and casino services went the other way.

Two consumer changes stand out. First, individual life and health insurance premiums are now exempt — no GST at all, where previously you paid 18%. That covers term plans, ULIPs, family floaters and senior citizen policies bought by an individual; group and corporate policies still attract 18%. Second, almost all medicines dropped to 5%, with 33 life-saving drugs moved to nil.

Tobacco was handled on a separate clock. Pan masala, gutkha, cigarettes and chewing tobacco stayed at 28% plus compensation cess until 1 February 2026, when they moved to 40% GST plus a new additional excise duty and, for pan masala, a Health and National Security Cess. As of September 2026 the 40% rate is in force for these goods.

The maths, both directions

Adding GST to a price that does not include it:

• GST = Base × rate ÷ 100
• Total = Base + GST

Removing GST from a price that already includes it — this is the one people get wrong:

• Base = Total × 100 ÷ (100 + rate)
• GST = Total − Base

Three worked examples

Example 1 — Adding 18% to a consulting invoice

A freelance designer in Pune bills a client in Pune ₹1,00,000 for a project. Design services are at 18%, and because both parties are in Maharashtra it is an intra-state supply, so the tax splits into CGST and SGST.

If the same client were in Karnataka, the designer would charge a single line of IGST @ 18% = ₹18,000 and the total would be identical. The split changes; the amount does not.

Example 2 — Removing 5% GST from a shoe price tag

A pair of shoes is marked ₹4,999 inclusive of GST. Footwear priced up to ₹2,500 sits at 5%; above that it is 18%. Assume this pair is under the threshold before tax, so 5% applies.

MRP in India is always GST-inclusive by law, so any time you want to know the true pre-tax price of something on a shelf, this is the calculation you need.

Example 3 — A large SUV at 40%, and what it used to cost

Take an SUV with an ex-factory taxable value of ₹20,00,000. Before 22 September 2025 it attracted 28% GST plus 22% compensation cess, an effective 50%. Now it attracts a flat 40% with no cess.

The 40% headline looks worse than the 28% it replaced, but because the compensation cess went away with it, big cars actually got cheaper. This is the single most misreported part of GST 2.0. The same logic applies to bikes above 350cc.

Item-wise rate table

Indicative rates as of September 2026 for commonly bought goods and services. Rates are set by HSN and SAC code, and a description in plain English can hide an exception, so verify against the official rate finder before you invoice.

CGST, SGST, IGST and UTGST

GST is one tax collected in two or three pieces, depending on where the supply goes. The customer pays the same total either way.

• Intra-state supply — supplier and place of supply in the same state. The rate splits equally: an 18% supply becomes CGST 9% + SGST 9%. The centre keeps the CGST, the state keeps the SGST.
• Inter-state supply — different states, or an export or import. A single IGST line at the full rate. The centre collects it and settles the state's share later.
• Union territories without a legislature use UTGST in place of SGST. Delhi and Puducherry have legislatures, so they use SGST.

Getting this wrong is a real and expensive mistake. Charge CGST + SGST when you should have charged IGST and your customer cannot claim the credit; you then have to issue a credit note, raise a fresh invoice and claim a refund of the wrongly paid tax. The deciding factor is the place of supply, which for goods is normally where they are delivered and for most services is the recipient's location.

Reverse charge in one page

Normally the supplier collects GST and pays it to the government. Under the reverse charge mechanism that flips: the recipient pays the tax directly, and the supplier's invoice carries no GST but must say "tax payable under reverse charge".

The notified list is short and specific. The ones a normal business actually meets:

• Freight paid to a goods transport agency.
• Legal services from an advocate or a firm of advocates to a business entity.
• Sponsorship services provided to a body corporate or partnership firm.
• Services supplied by a director to their company in a personal capacity.
• Import of services — a subscription to a foreign SaaS product, for example.
• Renting of commercial property by an unregistered landlord to a registered tenant.

Two things to remember. You must pay reverse charge tax in cash — you cannot set it off against your existing input tax credit balance. And once you have paid it, you can normally claim it back as input tax credit in the same or a later month, so for most businesses reverse charge is a cash-flow event rather than a real cost. Being liable under reverse charge also makes registration compulsory regardless of your turnover.

The composition scheme

A simplified option for small businesses that sell mostly to end consumers. You pay a flat percentage of turnover instead of collecting GST on each invoice, and you file quarterly instead of monthly.

The ceiling for goods is ₹75 lakh in the special category states of the North East and in Himachal Pradesh. The trade-offs are real: you cannot claim any input tax credit, you cannot charge GST to your customers (so a business customer gets no credit from you and may prefer a regular supplier), you cannot make inter-state outward supplies, and you must print "composition taxable person" on your bill of supply. Compliance is a quarterly CMP-08 payment and an annual GSTR-4.

The plain arithmetic: composition works when your customers are consumers who cannot use credit anyway, and when your input costs are low relative to turnover. It works badly for anyone selling B2B or buying a lot of taxed inputs.

How to check the rate for your HSN code

Rates attach to HSN codes for goods and SAC codes for services, not to product names. Two items that sound the same can sit in different chapters.

1. Open the CBIC GST rate finder at cbic-gst.gov.in, or the "Search HSN Code" utility on the GST portal at gst.gov.in.
2. Search by description first to find candidate codes, then read the chapter and heading notes to confirm which one your product genuinely falls under.
3. Cross-check against the rate notification. The Council's press release is a summary; the notification is the law.
4. If the classification is genuinely ambiguous and the amounts are large, apply for an advance ruling rather than guessing. A wrong classification carries interest and penalty, and the department has years to raise it.

How many digits you must print depends on your size: 4 digits if your aggregate turnover in the previous year was up to ₹5 crore, 6 digits above that. Exports and imports always need 8 digits.

What a compliant invoice looks like

A tax invoice for the consulting example above needs all of the following, or your customer's input tax credit is at risk:

• Supplier's name, address and GSTIN, and a consecutive invoice number and date.
• Recipient's name, address and GSTIN if they are registered; for unregistered recipients above ₹50,000, the address and the state name and code.
• HSN or SAC code, description, quantity and taxable value per line.
• The rate and amount of CGST and SGST separately, or of IGST — never a single merged "GST" line.
• Place of supply and state, which is what justifies the CGST/SGST versus IGST choice.
• Whether tax is payable on reverse charge, and a signature or digital signature.

Businesses above the e-invoicing turnover threshold must additionally generate an Invoice Reference Number on the government portal before the invoice is valid. Check the current threshold on the e-invoice portal, since it has been lowered several times.