Article
How is GST Calculated in India & various Rates of GST?
GST was undoubtedly the biggest tax reform, that this country ever witnessed. It not only brought uniformity in the taxation structure of India, but also eliminated various taxes that were levied in the past. The GST committee meets from time to time to revise the GST rates in India.
What are different types of GST in India?
GST or Goods and Services Tax is divided into three types, which are as follows: -
CGST - Central GST
SGST - State GST
IGST - Integrated GST
GST rates for some of the general items
| Tax Rates | Products |
| 5% | Household necessities such as edible oil, sugar, spices, tea, and coffee (except instant) are included. Coal, Indian Sweets and Life-saving drugs are also covered under this GST slab |
| 12% | This includes computers and processed food |
| 18% | Hair oil, toothpaste and soaps, capital goods and industrialintermediaries are covered in this slab |
| 28% | Luxury items such as small cars, consumer durables like AC and Refrigerators, premium cars, cigarettes and aerated drinks, High-end motorcycles are included here. |
Items like tea, sugar and coffee come under 5% slab, but milk on the hand does not attract any taxes under the GST Regime. The reason behind this is to ensure that the basic food items are available to everyone and instant items are kept out of this category.
The household items like tooth paste and hair oil are taxed at 18% under GST, earlier these items were taxed at 28%. Tax rates on coal has also been reduced to 5%, in order to reduce the pressure on the power industry.
Which items are exempt from GST?
Here is the list of items that are exempt from GST: -
- Hulled cereal grains like barley, wheat, oat, rye, etc.
- Bones and horn-cores unworked and waste of these products.
- Palmyra jaggery
- All types of salt
- Dicalcium Phosphate (DCP) of animal feed grade conforming to IS specification No. 5470 :2002
- Kajal [other than kajal pencil sticks]
- Picture books, colouring books or drawing books for children
- Human hair – dressed, thinned, bleached or otherwise worked
- Sanitary Napkins
- Unit container-packed frozen branded vegetables (uncooked/steamed)
- Vegetables preserved using various techniques including brine and other preservatives that are unsuitable for immediate human consumption.
- Music Books/manuscripts
- Chargeable services offered on Basic Savings Bank Deposit (BSBD) account opened under the PMJDY (Pradhan Mantri Jan Dhan Yojana)
What is the highest GST rate in India?
Currently, the highest rate of GST in India is 28%, which is levied on the following goods and services: -
- Entertainment events-amusement facility, water parks, theme parks, joy rides, merry-go-round, race course, go-carting, casinos, ballet, sporting events like IPL
- Race club services
- Gambling
- Food/drinks at AC 5-star hotels
- Accommodation in 5-star hotels or above
