GST: inclusive vs exclusive price, and how CGST / SGST / IGST split

Exclusive: adding GST to a base price

GST amount = base × rate ÷ 100. Total = base + GST. On a ₹1,000 item at 18%: GST is ₹180, total is ₹1,180.

Inclusive: pulling GST out of a total

When the amount already includes GST, you cannot just take 18% of it. Base = total × 100 ÷ (100 + rate). GST = total − base. On a ₹1,180 inclusive total at 18%: base is 1,180 × 100 ÷ 118 = ₹1,000, so GST is ₹180.

This 'reverse' step is where most manual errors happen — dividing by 118 (not 100 or 18) is the key.

CGST + SGST vs IGST

• Intra-state supply (buyer and seller in the same state): the rate splits equally into CGST and SGST. 18% becomes 9% CGST + 9% SGST.
• Inter-state supply (different states, or an import): the full rate is charged as a single IGST — 18% IGST.
• The total tax is the same either way; only the split and which government collects it differ.

Common rates

0%, 5%, 12%, 18% and 28% are the main slabs. 18% covers most services and a broad band of goods; 5% covers many essentials; 28% covers luxury and 'sin' goods, sometimes with an extra cess.

On the invoice

A tax invoice must show the taxable value, the rate, and the CGST/SGST or IGST amounts separately, plus the supplier's and (for B2B) the recipient's GSTIN. A cash memo without these is not a valid tax invoice for input credit.