How GST Is Calculated in India

Goods and Services Tax (GST) replaced a patchwork of indirect taxes in India with a single, tiered system. Most goods and services fall into one of four standard slabs: 5%, 12%, 18% or 28%.

Adding vs removing GST

There are two common calculations. To add GST to a base price: GST amount = base price × rate / 100. To go the other way — finding the base price from a GST-inclusive total — divide instead: base price = inclusive amount / (1 + rate/100).

A common mistake is applying the rate directly to an already-inclusive amount, which overstates the tax. If a price already includes GST, always use the division formula, not the multiplication one.

CGST, SGST and IGST

• CGST + SGST: applied together, in equal halves, on sales within the same state.
• IGST: applied as a single combined tax on sales between different states.
• The total tax rate is the same either way — only how it's split changes.

A quick example

On a ₹1,000 base price at 18% GST: GST amount = ₹180, split into ₹90 CGST and ₹90 SGST for an intra-state sale, bringing the total to ₹1,180.