GST Rates in India After GST 2.0: Slabs, CGST/SGST Split and Examples

The 56th GST Council replaced the old five-slab structure. The 12% and 28% slabs were removed: most items moved from 12% to 5% and from 28% to 18%, and a short list moved to a new 40% rate. The table shows the rates in use as of October 2026, the usual CGST/SGST split, and examples.

Compensation cess has ended. It stopped on most goods on 22 September 2025. Tobacco products and pan masala kept the old rate plus cess until 1 February 2026; since then pan masala, cigarettes and tobacco are at 40% GST and bidis at 18%, with a separate excise duty and cess charged outside GST.

Rates are set by the GST Council and can change at its meetings, so confirm the rate for your item's HSN or SAC code before you invoice.

GST is not a single payment to one government. It is a dual-levy system:

• CGST (Central GST) — collected by the Central Government on intra-state supplies.
• SGST (State GST) — collected by the State Government on the same intra-state supply. UTGST replaces SGST in Union Territories without a legislature.
• IGST (Integrated GST) — collected by the Centre on inter-state supplies and imports. IGST equals CGST + SGST combined, applied as a single levy.

The rule of thumb: same state → CGST + SGST; different states → IGST.

Example: A Delhi-registered business sells software services to a client also in Delhi at 18% GST. The bill shows CGST 9% + SGST 9%. The same business selling to a Mumbai client shows only IGST 18%. The tax collected by the Centre is then apportioned to the consuming state — this is the destination-based principle GST was built on.

From an input tax credit (ITC) standpoint, CGST credit can offset CGST or IGST liability; SGST credit can offset SGST or IGST liability; IGST credit can offset IGST, then CGST, then SGST in that order.

These two cases trip up more people than any other part of GST arithmetic.

GST-Exclusive (tax added on top) — the price quoted does not include GST. This is the standard for B2B invoices.

1. GST Amount = Base Price × (GST Rate ÷ 100)
2. Total Price = Base Price + GST Amount

Example: A consulting invoice has a base value of ₹50,000 at 18% GST.

• GST = ₹50,000 × 0.18 = ₹9,000
• You pay = ₹50,000 + ₹9,000 = ₹59,000
• On the invoice: CGST ₹4,500 + SGST ₹4,500

GST-Inclusive (tax already embedded) — the quoted price includes GST. Common in retail where the MRP is printed on the pack.

1. GST Amount = Total Price × GST Rate ÷ (100 + GST Rate)
2. Base Price = Total Price − GST Amount

Example: A service bill shows ₹1,180 inclusive of 18% GST.

• GST = ₹1,180 × 18 ÷ 118 = ₹1,180 × 0.15254 = ₹180
• Base (service value) = ₹1,180 − ₹180 = ₹1,000

The shortcut formula GST = Total × R / (100 + R) works for any rate R. Memorizing it saves time on every inclusive-price check.

The following examples show a complete invoice line at each of the main rates, priced exclusive of GST and sold within the same state.

Notice that CGST and SGST are always equal halves of the total GST. For a sale to another state, the same GST amount appears as a single IGST line instead.

Applying the wrong slab to a similar product: Rates follow the HSN or SAC code, not the product's everyday name, and similar-looking items can sit in different slabs. Look up the code for each item. Also check that price lists and invoice templates no longer use the 12% or 28% rates removed on 22 September 2025.

Confusing MRP with base price: When a retailer is required to charge GST on the MRP (printed maximum retail price), back-calculate the base using the inclusive formula — do not apply the rate on top of MRP, or you double-count.

Composite and mixed supplies: When a box of chocolates is gift-wrapped, the supply may be treated as a composite supply (principal supply determines rate) rather than split into components. Getting this wrong affects both output tax and ITC claims.

Place of supply for services: For B2B services, the place of supply is generally the location of the recipient. For B2C, it is usually the provider's location. This determines whether CGST+SGST or IGST applies and which state collects the revenue.

Input Tax Credit (ITC) eligibility: ITC is blocked on certain expenses — personal car purchases, food and beverages, club memberships, works contract services used for construction of immovable property. These items still carry GST on purchase; you simply cannot offset that against your output liability.

Under RCM, the recipient of goods or services pays GST instead of the supplier. This applies in specific situations: import of services, supply from unregistered dealers in notified categories, and certain defined services like legal fees from an individual advocate to a business.

When RCM applies:

• The supplier does not charge GST on the invoice.
• The recipient self-assesses and pays GST directly to the government.
• The recipient can claim ITC on that payment in the same tax period, subject to normal ITC rules.

The calculation is identical to normal GST — same slab, same CGST/SGST or IGST split depending on place of supply — only the direction of payment changes.

Manual calculation is straightforward once you know the formula, but invoice volumes make errors inevitable. The GST Calculator on UtilityApp handles both exclusive and inclusive amounts at the current rates (0%, 0.25%, 3%, 5%, 18% and 40%) and shows the GST amount, the CGST and SGST split, and the net and gross values.

Enter the amount, pick the rate and say whether the amount includes GST. For a sale to another state, read the GST figure as IGST. It is useful both when raising invoices and when checking bills you have received.