What Are The Current GST Rates In India? (2023 Rates)

GST is a one-stop solution for different tax issues and developed uniformity in tax distribution in India.

Every Indian business person and consumer is affected by GST in terms of expenditures and savings. The economy is impacted from lower to higher levels as GST affects industries, trade groups, and consumers.

With GST, essential services and food items are taxed at a lower rate, while luxury products and services are taxed at a higher rate. All goods and services are categorized into four slabs.

In this article, you will learn about the What are the current GST rates in India.

What Are the Current GST Rates in India in 2022?

With GST, the price of products are more predictable and equally distributed across the country. Ultimately, it aims to reduce manufacturing costs and create a unified market that is more evenly priced across the country.

GST council has categorized over 1300 goods and 500 services into four tax slabs of 5%, 12%, 18%, and 28%.

In India, the GST Council meets periodically to discuss and revise the GST slabs for different goods and services.

The latest rate revision was brought into effect in the 47th GST Council Meeting which was held on 18th July 2022. 

Please find the list of revisions done in the meeting:-

Detail About the GST Slab Rates?

GST Slabs are decided by the GST Council. Rate slabs for goods and services are periodically revised by the GST Council. In general, luxury supplies are subject to a higher GST rate than essential needs.

The Goods and Services Tax (GST) applies to the supply of goods and services, from the manufacturer to the end user. 

There are five GST slabs in India for various goods and services: 

•  0% GST
•  5% GST
• 12% GST
• 18% GST
• 28% GST

Based on certain parameters, each slab includes different categories of items. In order to improve transparency between buyers and sellers, different GST slab rates have been established.

What is the GST rate in India 2022?

GST Council revises inclusions under these rates from time to time in order to ensure efficient pricing of different categories of goods and services.

The main aim of the GST council to revise GST rates is to correct the prevailing inverted tax structure and to revise the revenue augmentation.

On the 28th and 29th of June 2022, the 47th GST council meeting was held, in which decisions regarding GST rates were taken including pruning of the exemption list and correcting the inverted tax structure.

According to different categories of goods and services, GST rates are fixed by the GST Council of India. They have categorized all into 5 rate slabs:  0%, 5%, 12%, 18%, and 28%.

Which are 0.25 GST rate items?

Following are the list GST on supplies of Goods – IGST  0.25%, CGST 0.125%, SGST / UTGST 0.125%.

What product is 18% GST?

All essential and food items come under the category of 0% GST. As we move forward toward luxury items, the GST rate also increases.

In the Goods category, Electronic and electric devices, chocolate, and ice cream come under the category of 18%.

In services, professional, IT, and telecom services come under the category of 18%. 

A few examples are listed below:

Household products, including hair oil, toothpaste, shampoo, etc. Length measuring by hand, like measuring tapes, calipers, etc.

Below is the list of Goods and services, whose slab has changed to 18% in the latest 47th GST Council meeting. 

What are the 3 types of GST?

GST represents a transparent tax system that is imposed on goods and services. 

Taxes are levied by the government to generate revenue which helps in the economic growth of the country.

There are four types of GST that are categorized, which help in maintaining a fair and simple division of taxes among the State/UT and Central government. 

1. IGST (Integrated Goods and Services Tax) –

In case of an interstate supply of goods and services, IGST is levied. Central Government is responsible for the collection of taxes.

2. SGST (State Goods and Services Tax) – 

SGST is applicable to intrastate transactions ( within the state ). In such cases, both CGST and SGST will be applicable.

3. CGST(Central Goods and Services Tax) – 

CGST is also applicable to intrastate transactions. The revenue earned from CGST will go to the Central government.

4. UTGST (Union Territory Goods and Services Tax) –

UTGST is the counterpart of SGST. It is applicable to intra-UT supply of goods and services transactions. 

What are the items under 12% GST?

One of the primary reasons behind bringing a single tax (GST) by subsuming nearly 17 indirect taxes is to eliminate the cascading or “tax on tax” effect prevalent earlier.

GST tax rate slab of 12% applies to processed food items. Here is the list of items that come under the 12% GST tax slab.

What is GST luxury goods rate list?

The term luxury refers to goods or services described as providing comfort, entertainment, or pleasure in life. Luxury Goods are now classified at the highest tax rate 28%.

Hotels, inns, resorts, and meeting rooms are all subject to the Luxury Goods Service Tax, but that’s not all. Other associations with accommodations may also be subject to the luxury tax.

The table below shows the goods and services that fall under each of these headings.

Goods with and without cess

Goods with and without cess

Services

•  Hotel stay with over Rs.7500 bill
•  5-star hotel services
•  Gambling
•  Go-karting
•  Ballet
•  Racing club services
•  Casinos
•   Entertainment services,
•  Theme parks, amusement parks, and joy rides
•  Sports events

When did GST become 5%?

Since 1st January 2008, the GST has been lowered twice and currently is at 5%. The Government of Canada announced in its Economic Statement on October 30, 2007, that GST will be reduced.

On which items GST is 28 %?

Around 200 items invite a tax of 28%. Out of these, luxury items and sin goods, like cigars are the major ones. The list of items under the 28% slab is as follows:

What are 0% GST items?

GST Council has adopted the perfect strategy and ensured that essential items and those products that are consumed in large amounts are kept away from the GST.

Items that won’t come under GST are called a negative list. These items are also notified under Schedule III of the CGST Act. There will be no text on items like

Example: Fresh milk, Fresh fruits, Curd, Bread, etc. Supplies for export made to SEZ or SEZ Developers. Supplies that have a declared rate of 0% GST. Example: Salt, grains, jaggery, etc

• Services by an employee to the employer in the course/ relation to employment
• Services of funeral, burial, crematorium, or mortuary
• Sale of land
• Sale of completed buildings
• Claims that are actionable (other than lottery, betting, and gambling)
• Services by any court or Tribunal
• Functions performed by the MPs, MLAs, etc.
• Those duties are performed by any person holding a post under the Constitution.

Is all GST 10%?

In India, total GST is not 10% of the invoice as some items can be of 0% slab and others can be of 18% slab. Here we have 5 slabs for different categories of goods and services- 0%, 5%, 10%, 18%, and 28%.

GST in Australia is 10% on most goods and services.

What is the golden rule of GST?

The Golden Rule says, “Do unto others as you would have them do unto you.” 

It is a moral which says that treat others as you would like them to treat you. 

The main principles on which GST works are as follows:

1) GST exemption for small traders less than 20 lakhs 

2) GST registration is just above the threshold limit.

3) Separate rates for the Composition scheme up to 75 lakhs, but no ITC is allowed and no interstate supplies are allowed 

What is ITC in GST?

Input Tax Credit is a mechanism (for GST-registered persons) to avoid cascading taxes (tax on tax). 

To avail ITC benefit, the Supplier need not pay the tax that he has already paid while purchasing raw materials, capital goods, and services to manufacture a product.

• It is the most important concept of GST.
• ITC is Input Tax Credit.
• GST registration is necessary to book ITC.
• A registered GST person gets the main benefit of ITC.

Who needs to pay GST?

Under GST, a ‘taxable person’ is someone who operates a business at any place in India and is registered under GST Act. 

• A person who is involved in economic activity including trade and commerce is treated as a taxable person. 

• ‘Person’ in this context includes individuals, HUFs, companies, firms, LLPs, an AOP/ BOI, any corporation or Government company, a body corporate incorporated under laws of a foreign country, cooperative society, local authority, government, trust, an artificial juridical person.

• Supplier of any goods or services is liable to pay GST. 

• The recipient may be liable in certain cases, such as imports and notified supplies.

Why is GST 3% on gold?

Charges or value additions on gold are considered job work and are considered charges on goods. 

The GST for gold was fixed at 3%, with an additional 5% tax levied on making charges.

Frequently Asked Questions (FAQ):-

Which state passed GST first?

Assam is the first state which passed the GST. 

GST is an indirect tax implemented in India on 1st July 2017. As part of the 101st amendment act, GST was passed.

What is the minimum turnover for GST?

The minimum turnover for GST is 20 lakhs. Businesses that have a turnover of more than 20 lakhs in a financial year need to register under GST. 

For special category states like North Eastern and hilly states, this limit has been reduced to 10 lakhs.

Do we need GST for Small Businesses?

According to the GST Act, all small businesses are required to register for GST.

Is GST calculated on profit?

No. GST is calculated on the selling price. 

What percentage of GST is gold?

In India, a GST of three percent is charged on gold. 

Is GST 5% or 6%?

There are only four GST slabs. 

5% GST, 12% GST, 18% GST, & 28% GST.

What is GST rate for cake?

Cakes and pastries are taxed at @ 18%.

What is TDS?

TDS is Tax Deducted at Source. 

TDS came into effect with the aim to collect tax from the very source of income. 

The person who is liable to make payment to any other person shall deduct tax at source and remit the same amount to the Central government account.

Later the deductee can claim the credit of the amount deducted on the basis of form 26AS issued by the deductor.

Wrapping Up

This article gives you a comprehensive guide on current GST rates in India. 

To make all information easy to understand, clear and visual, we have tried to provide simple and concise information. 

Please feel free to leave a comment with your questions and suggestions.

Also Read:-

Effect Of GST On Gold Price [2022] – InstaFiling

RCM On Purchases From Unregistered Dealers In GST (Ultimate Guide)