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Everything you need to know about GST rates

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The Goods and Services Tax (GST) is a destination-based tax on the supply of goods and services. IT is a single tax that is applied from the point of manufacturing to the point of sale. The goal of the GST was to achieve pricing parity across the country. 

Let’s talk about the GST tax slabs. The GST Council meets on a regular basis to modify the GST rates for various goods and services. Several states and businesses have recommended adjustments to the current states during these discussions.

Slabs under GST rates

  • Lower tax bracket: It includes mostly consumable items like food and essential services so that everyone class of society can easily afford them.
  • Higher tax bracket: it includes mostly luxury products and luxury services.


  • 5% tax slab: It includes items such as edible oil, spices, tea (excluding quick coffee), sugar, walking sticks, and life-saving medications, among others.
  • 12% tax slab: Computer, processed meals, pickles, jam, sauce preparation, spoons, forks, and other goods are included in this list.
  • 18% tax slab: Hair oil, toothpaste, and soaps, as well as capital goods, industrial middlemen, and furniture are all included.
  • 28% tax slab: Air conditioners, refrigerators, electronic gadgets, high-end automobiles, and other luxury things are included.


  • Exempted tax slab: Fresh fruits and vegetables, milk and dairy products, sanitary napkins, salt, and other commodities are tax-free or have a 0% tax rate.

Comprehending the GST's applicability

The Goods and Services Tax (GST) was initially implemented to combine practically all direct taxes into a single tax known as the Goods and Services Tax. GST incorporated both the federal and state governments’ indirect taxes. GST is currently the primary source of indirect tax income for both state and central governments. 

  • CGST: The central GST, or CGST, is a tax collected by the Indian government on all goods and services transactions that take place inside a state. It is one of two taxes levied on intrastate transactions, the other being the SGST. The CGST rate is normally the same as the SGST rate.

remember in the last article I talked about domino’s pizza where consumers like you and me pay 5% GST, that 5% GST was also divided into half 2.5%, and then paid to the central and state government. so 2.5% for CGST and 2.5% SGST.

  • SGST: The state GST (SGST) is a tax charged by the state government on all intra-state goods and services transactions. The state government is the only one who may claim the SGST money. It is imposed by the state in which the items are sold or bought.


  • IGST: IGST stands for integrated global supply chain technology. GST is levied on both interstate and intrastate goods and services transactions, as well as imports. When a product or service is transported from one state to another, the IGST is applied.

HSN Code: Harmonized System of Nomenclature, It consists of 6 digits for categorizing over 4500 products. 

SAC Code: Services accounting code to classify the services. 

When invoicing, how to apply GST rates to a specific good/service.

Any individual who is GST-registered must present a GST-compliant invoice for the sale of goods or services they offer. A GST invoice is required to include a few essential fields.

  • GSTIN of Buyer and Supplier.
  • Date.
  • Address. 
  • Percentage of Tax.
  • Description of Goods.
  • Rate/Amount.
  • HSN/SAC code.
  • Signed by an authorized person.

CGST and SGST are always included in invoices for intra-state supplies. IGST will be levied on interstate supplies. The location of supply impacts whether GST is charged on the interstate or intrastate transactions.

Example: Buyer is registered in Delhi and Supplier is also registered in Delhi. then It will be Intra-State supply and CGST and SGST will be levied.

If the supplier is registered in Delhi and the buyer is registered in Haryana then it will be an intra-state supply and IGST as tax will be levied.  

How to Handle Changes in GST Rates

A tax invoice can be revised in a variety of ways. If the tax rate increases or the amount of tax charged decreases, the supplier can submit a supplementary invoice for any upward or downward modification to address the situation. Supplementary invoices, such as debit and credit notes, are also available from the supplier. Issue an additional invoice if the return has already been filed. The original invoice will be supplemented within one month of the date of issue.

GST rates prohibit profiteering.

Profiteering is a phrase that refers to making excessive profits in the course of normal business. The Indian government is dedicated to safeguarding consumers against predatory practices, particularly with the implementation of GST. The anti-profiteering section allows the central government to investigate ITC claims and apply fines.

Consequences of Failure to Pass on Rate Cuts

  • Within two months, the national anti-profiteering authority (NAA) will review the complaints submitted through the application form.
  • The case is reported to the Director-General of Safeguards if prima facie evidence of profiteering is identified.
  • Within three months, the DGS will launch an inquiry and gather evidence to confirm the claim.
  • Interested parties will be allowed to be heard.
  • The authority might mandate a price decrease, a refund, a penalty, or the cancellation of the GST registration.

Final Words

I hope, I gave you some insights about GST rates and GST slabs and delivered it in the best possible way. 

If you have any queries related to the same then do leave a comment, and I will respond to it. 

DO SHARE THIS ARTICLE with your friends or family who are not aware of GST rates and GST slabs.  You can tweet out your thoughts by tagging me @rajatinr on Twitter.

To your Success

-Rajat Negi, Logging Out 🤗

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Rajat Negi

Compound Investor (Who loves to talk to stock)
Digital Marketer (Who loves to make brands)

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