Two main slabs, one demerit rate, and the add/remove formulas every invoice depends on.
From 22 September 2025 the four main slabs were rationalised into two — 5% (merit) and 18% (standard) — plus a 40% rate for luxury and sin goods. Special rates remain, such as 3% on gold and 0.25% on rough diamonds.
GST = Amount × rate and Total = Amount × (1 + rate). ₹1,00,000 + 18% GST = ₹1,18,000.
Base = Total ÷ (1 + rate). ₹1,18,000 ÷ 1.18 = ₹1,00,000 and ₹18,000 GST. Taking 18% of the total (₹21,240) is the common mistake.
| Supply | Tax charged | On ₹1,00,000 at 18% |
|---|---|---|
| Within a state | CGST 9% + SGST 9% | ₹9,000 + ₹9,000 |
| Between states | IGST 18% | ₹18,000 |
Cement moved from 28% to 18%. Steel stays at 18%, sand-lime bricks fell to 5%, and fly-ash and other bricks are 12% with input tax credit or 6% without. Most works contracts and contractor services are 18%; government and affordable-housing contracts have specific notification entries, so confirm the rate before billing.
Registration is required above ₹40 lakh turnover for goods (₹20 lakh for services; lower in special-category states). GSTR-1 is due on the 11th and GSTR-3B on the 20th of the following month for monthly filers.
