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GST Rates 2023 - Complete List of Goods and Service Tax Rates

All you should know about GST rates in India

Updated on: 16 Dec, 2024 04:06 PM

GST or the Goods and Services Tax, has been one of the biggest tax reforms in India. It has attempted to bring uniformity in the tax structure which had previously been quite complicated for the general population as well as the government and businesses. The GST tax rates have been revised from time to time as per the decisions of the GST Council. Several state legislatures and industrial authorities have maintained their rights to put forth their opinions to revise tax rates. Presently, GST has been structured in such a way that basic essential items have lower tax brackets than luxury services and products. The rate list and the tax slabs shall be discussed in this article. This article discusses the GST rates in India, types of GST, exempted items under GST, etc.

Types of GST
Input tax credit under GST
Relation between HSN code and SAC code
GST rate under composition scheme
GST Tax Rates on common items
GST tax rate for Goods
GST rates for services
Exemptions under GST
List of goods exempt from GST
List of GST Exemption on Services
Frequently Asked Questions

Types of GST

One must note that there are basically three types of GST.

CGST- Central Goods and Services Tax is applicable on the goods and services which are considered to be standard and tax rates can be amended periodically. All the revenue collected is allocated to the central government. As per the Central Goods and Services Tax Act 2016, it is the centralized part of GST that includes most of the central taxations, namely Central Sales Tax, Central Excise Duty, Service Tax, and Additional Custom Duty, among various other centralized taxations.
SGST- State Goods and Services Tax comprises of various taxations and levies under the state authority, which are part of one uniform taxation structure. It mainly includes a combination of various taxes, namely Entertainment Tax, Levies on Lottery, State Sales Tax, and Luxury Tax, among various other types. The revenue collected here belongs to the state government. The mainstream framework is designed by the central government.
IGST- Integrated Goods and Services Tax is charged on the supply of goods and services as transferred from one state to another. As per Article 269A of the Indian Constitution, the inter-state trade and commerce activities that involve the movement of commodities levy the IGST. The revenue collected is sent to the Government of India.

Input tax credit under GST

Input tax means taxes paid on the input and input tax credit means that when you pay tax for the output you can deduct the amount of input taxes paid by you and only the balance amount is paid by you.

For eg :- when we buy goods from the dealer we have to pay the amount of GST to the dealer and at the time we sell the goods we collect the amount of GST from the customers. Now you can adjust the amount of input tax with output tax and balance amount shall be paid.

ITC can be claimed for business purposes, it is not available for the goods and services used for the Personal use, Exempt supplies, and for those supplies for which ITC is not specifically available.

Relation between HSN code and SAC code

HSN code stands for the harmonised system of nomenclature and SAC is stands for service accounting code. HSN code is used for classifying all the goods under the GST Act, whereas SAC is used for classifying the services under the GST Act.

GST rates are the percentage of rates on which any goods or services are charged to GST.

GST rate under composition scheme

Businesses with annual turnover upto rupees 1.5 crores can opt for the composition scheme.

Here are the GST rates for composition scheme dealers -

Business	CGST	SGST	Total
Manufacturing and Traders of goods	0.5%	0.5%	1.0%
Restaurants not serving alcohol	2.5%	2.5%	5%
For Service providers	3%	3%	6%

GST Tax Rates on common items

GST tax rates have been considered as per the necessity of the goods they are levied upon. The following table shall give you an idea of the different tax slabs for some basic items. As one may notice, it has been taken care that items of basic necessities reach the population with minimum tax rates.

GST tax rate for Goods

Tax Rate Slab	Products
0%	Milk, unbranded atta, unbranded maida, gur, , eggs, kajal, curd, lassi, child drawing and colouring book, unpacked foodgrains, unpacked paneer, besan, prasad, unbranded natural honey, fresh vegetable, jaggery, salt, Phool wali jhadu.
5%	Household items like edible oil, sugar, tea, spices, coffee, packed paneer, coal, raisin, domestic LPG, roasted coffee beans, PDS kerosene, skimmed milk powder, cashew nuts, footwear upto 500, milk food for babies, apparel up to 1000, fabric, matting and floor covering, agarbatti, Indian sweets and Life-saving drugs.
12%	Computers, processed food items, Butter, ghee, almonds, Mobile, fruit juice, Packed coconut water, umbrella, preparation of vegetables,fruits, nuts and other parts of plants including pickle murabba, chutney, jam etc.
18%	Personal Care items like hair oil, toothpaste, soaps, toiletries Capital goods and industrial intermediaries. Ice creams, pasta, cornflakes,soups.
28%	Small cars, consumer durables like ACs and refrigerators. Luxury cars like BMWs, cigarettes and aerated drinks (+15% cess) (beedies are not included here) High-end motorcycles(+15% cess) etc.

GST rates for services

Product	Rates
0%	Education services, Health services
5%	Railways-Transportation of goods, passengers, Transportation of goods in a vessel from outside India, Renting a motor cab (without fuel cost)Transport services in AC contract or stage or radio taxi, Transport by air (scheduled) or air travel for the purpose of pilgrimage via chartered or non-scheduled flights, Tour operator services, Leasing of aircrafts, Print media ad space, work of printing of newspapers.
12%	Transportation of goods in containers through rail from a third party other than Indian Railways, Air travel excluding economy, Food /drinks at restaurants without AC or heating or liquor license, Renting of accommodation for more than Rs.1000 but less than Rs.2500 per day, Chit fund services by foremen, Construction of building for the purpose of sale, IP rights on a temporary basis, Movie Tickets less than or equal to Rs. 100
18%	Food or drinks at restaurants with liquor license, Food or drinks at restaurants with AC/heating, Outdoor catering, Renting for accommodation for more than Rs.2500 and less than Rs.5000 per day, Supply of food, shamiyana, and party arrangement, Circus, Indian classical, folk, theatre, drama, Supply of works contract, Movie Tickets which exceeds Rs. 100
28%	Entertainment events such as amusement facility, water parks, theme parks, joy rides, merry-go-round, race course, go-karting, casinos, ballet, sporting events like IPL, Race club services, Gambling, Food/drinks at AC 5-star hotels, 5-star hotels or above accommodation

Exemptions under GST

Supplies of goods or services which are taxable at NIL rate of tax are exempt supplies. Certain supplies are exempted from the GST due to their nature. Supplies which are notified by the government are exempted from GST

List of goods exempt from GST

Here is a list of the goods exempt under GST -

Category	Products
Animal Products	Live animals: Asses, cows, sheep, goats, poultry
	Meat: Fresh and frozen meat from sheep, cows, goats, pigs, horses
	Fish: Fresh or frozen fish
Natural and Agricultural Products	Natural products: Honey, fresh and pasteurized milk, cheese, eggs
	Live trees and plants: Bulbs, roots, flowers, foliage
	Vegetables: Tomatoes, potatoes, onions, carrots
	Fruits: Bananas, grapes, apples, oranges
	Dry fruits: Cashew nuts, walnuts, almonds
	Grains: Wheat, rice, oats, barley
	Products of the milling industry: Various types of flour
	Seeds: Flower seeds, oil seeds, cereal husks
Beverages and Spices	Tea, coffee, and spices: Coffee beans, tea leaves, turmeric, ginger, black pepper
	Water: Mineral water, tender coconut water, packaged drinking water
Processed and Baked Goods	Sugar products: Sugar, jaggery
	Baked goods: Bread, pizza base, puffed rice, pastries
Energy and Industrial Goods	Fossil fuels: Electrical energy
	Fertilizers: Goods and organic manure
Health and Personal Care Products	Drugs and pharmaceuticals: Human blood, contraceptives, vaccines
	Beauty products: Bindi, kajal, kumkum, herbal cosmetics
Waste and Recycling	Waste: Sewage sludge, municipal waste, recyclable waste
Accessories and Printed Items	Ornaments: Plastic and glass bangles
	Newsprint: Judicial stamp paper, envelopes, rupee notes
	Printed items: Printed books, newspapers, maps
Textiles and Handicrafts	Fabrics: Raw silk, silkworm cocoon, khadi, cotton, wool, synthetic fabrics
	Hand tools: Spade, hammer, gardening tools
	Pottery: Earthen pots, clay lamps

List of GST Exemption on Services

Here is a list of the services that are exempt under GST –

Types of services	Examples
Agricultural services	Cultivation, supplying farm labor, harvesting, warehouse-related activities, renting or leading agricultural machinery, services provided by a commission agent or the Agricultural Produce Marketing Committee or Board for buying or selling agriculture produce, etc.
Government services	Postal service, transportation of people or goods, services by a foreign diplomat in India, services offered by the Reserve Bank of India, services offered to diplomats, etc.
Transportation services	Transportation of goods by road, rail, water, etc., payment of toll, transportation of passengers by air, transportation of goods where the cost of transport is less than INR 1500, etc.
Judicial services	Services offered by the arbitral tribunal, partnership firm of advocates, senior advocates to an individual or business entity whose aggregate turnover is up to INR 40 lakhs
Educational services	Transportation of faculty or students, mid-day meal scheme, examination services, services offered by IIMs, etc.
Medical services	Services offered by ambulances, charities, veterinary doctors, medical professionals, etc. does not include hair transplant or cosmetic or plastic surgery.
Organizational services	Services offered by exhibition organizers for international business exhibitions, tour operators for foreign tourists, etc.
Other services	Services offered by GSTN to the Central or State Government or Union Territories, admission fee payable to theatres, circuses, sports events, etc. which charge a fee up to INR 250

GST has truly stood up to the expectations of various industries as a landmark tax reform in India. There are several industries which have been affected by it mostly in the positive sense. The general population is overall quite satisfied with the updated tax reforms which have been customised as per the necessity of the products.

Regular GST Council meetings have performed well to bring in relevant reformation which shall be helpful to different types of industries and the needs of the citizens. The GST tax slabs have been considerably fixed such that the majority population receives their basic products and services with minimum tax levied. One must keep a track of the updated GST lists to have a record of the tax rates meant for different items.

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Frequently Asked Questions

Q- What are the benefits of GST?

The Goods and Services Tax has been introduced in India with the purpose of unifying the tax structure such that it eases the process of tax exemption for several units. There have been several benefits of the GST for the Central and State Governments as it makes the process of administration easier, controls leakage in a better way and also increases the efficiency of the revenue system. For the industries and businesses, compliance has become easier and transparent. Manufacturers and exporters have also observed a gain as the overall cost of production has decreased. For the general consumer, GST relieves them of several other tax burdens as the single tax ends all other hassles.

Q- How can one calculate the GST on a product?

To understand the GST on a product, let’s imagine a product of price set at Rs 1000. As per the updated rules, let’s say that the GST levied to the product is 18%. Therefore, the amount charged as GST will be 18% of the 1000 which is Rs. 180. This amount is added to the original selling price for the total amount to be calculated which would come at Rs. 1,180. Similarly, GST can be calculated for any product by going through the list of GST Tax Slabs and identifying the rates on different products.

Q- What are the different GST rate slabs?

The GST council set up has identified 1300 goods and 500 services to be put into different tax slabs of mainly four figures- 5%, 12%, 18% and 28%. This does not include the tax on gold and special/semi-precious stones placed at special rate of 3% and 0.25% under GST respectively. As one can understand by going through the official lists, the more basic and essential items are placed lower in the list and luxury items are placed in higher tax slabs.

Q- Which services cost Nil GST Tax?

There is a Nil GST tax on the chargeable services which are offered on Basic Savings Bank Deposit (BSBD) account which can be opened under the Pradhan Mantri Jan Dhan Yojana (PMJDY). There are few other services and goods which cost nil GST tax which are usually counted under the most basic needs of the citizens.

Q- What is the importance of GST Council Meetings?

The GST Council is set up by the representatives of various state governments of India including the Central Government of India. These councils regularly hold meetings to update the GST tax slabs on goods and services. Some of the major GST council meetings which can be noted are the 28th, 29th, 30th, 31st and 32nd GST Council Meetings last held on 10th January 2018 which have determined the present structure of the GST tax rates.

Q- How GST rates are decided in India?

The GST Council, led by the Union Finance Minister, determines the GST rates. Its members include the Union Minister of State for Finance and state finance ministers, collectively referred to as the Group of Ministers.

Q- Which items have the highest GST rate in India?

The highest GST rate in India is 28%. Automobiles, tobacco, aerated beverages, and air travel are examples of commonplace commodities that are included in this tariff. In conclusion, luxury items as well as some everyday items are subject to the 28% GST rate cap in India.

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