What is Goods and Services Tax (GST)?
GST (Goods & Service Tax) is an indirect tax reform which ultimately aims at removing the tax barriers between states and create a single market which is open to all to buy, sell, import, export within the country. It’s exclusively designed to provide economic freedom to traders.
Before GST, there were more than 17 Indirect Taxes but GST subsumed all and became a single indirect tax for the whole nation, leading to the “ONE NATION ONE TAX” structure.
Standard GST Slabs in India
GST is divided into five different tax slabs for the collection of tax:
How to Calculate GST: Example & Formula
Understanding the core terminology is key to accurate business accounting:
- Taxable Value (Exclusive): The base value on which GST is applied.
- Invoice Value (Inclusive): The sum total of Taxable value + GST amount.
Calculation Example:
If you purchase a product worth ₹100 within your state at 18% GST:
• Taxable Value: ₹100
• CGST (9%): ₹9
• SGST (9%): ₹9
• Total Payable: ₹118
Reverse GST Calculation
If you have an invoice amount (Inclusive of GST) and want to find the base price, use this formula:
How to use this GST calculator
Since the process of calculation can be complex, Rectopages made it simple:
- Select Mode: Choose "Exclusive" to add tax, or "Inclusive" to see the tax hidden in the price.
- Enter Amount: Type in the original amount or the invoice total.
- Pick GST Rate: Click on the applicable tax slab (5%, 12%, 18%, or 28%).
- Analyze Results: View the breakdown of CGST, SGST, and the final net/total amounts instantly.