Question 1

How to extract GST from MRP (Inclusive formula)?

Accepted Answer

To extract GST backwards from a Maximum Retail Price (MRP) or GST-inclusive total, use the reverse GST formula: Net Base Amount = (Total Gross Amount × 100) ÷ (100 + GST Rate), and GST Extracted = Total Gross Amount − Net Base Amount. For example, if an invoice or MRP is ₹1,180 with 18% GST: Net Base Amount = (1,180 × 100) ÷ 118 = ₹1,000, and GST extracted is ₹180 (split into ₹90 CGST and ₹90 SGST).

Question 2

What is the difference between CGST, SGST, and IGST?

Accepted Answer

For intra-state transactions (seller and buyer within the same State/UT), GST is split equally into Central GST (CGST, 50%) and State/UT GST (SGST/UTGST, 50%). For inter-state transactions (seller and buyer in different States), 100% Integrated GST (IGST) is levied by the Central Government and subsequently apportioned to the destination consumer state. The total tax liability remains identical regardless of whether supply is intra-state or inter-state.

Question 3

Is GST calculated before or after discount?

Accepted Answer

Under Section 15(3) of the Central Goods and Services Tax (CGST) Act, trade discounts recorded on the invoice are deducted before calculating GST. Tax is levied strictly on the net transaction value. For example, if an item has an MRP of ₹1,000 and a 10% trade discount (₹100) is provided on the invoice, 18% GST applies to the discounted taxable base of ₹900 (GST = ₹162, total = ₹1,062), not on ₹1,000.

Question 4

What is the GST rate on gold in India?

Accepted Answer

Gold bars, coins, bullion, and jewelry attract a special statutory GST rate of 3% (HSN Code 7113). In addition, jewelry making charges (job work) attract 5% GST (SAC 9988) if billed separately. By contrast, rough industrial diamonds attract 0.25% GST, and cut and polished diamonds attract 1.5% GST.

Question 5

What is the reverse GST formula and how does a reverse GST calculator work?

Accepted Answer

A reverse GST calculator extracts the original pre-tax value from a gross total price. The mathematical formula is: Net Amount = Gross Amount ÷ (1 + (GST Rate ÷ 100)). The tax component is Gross Amount − Net Amount. This reverse extraction is standard for consumer retail products where the price tag already includes tax.

Question 6

How does Input Tax Credit (ITC) work with GST calculations?

Accepted Answer

Input Tax Credit (ITC) prevents cascading taxation by allowing registered businesses to offset the GST paid on inward purchases against the GST collected on outward sales. For example, if you purchase raw materials for ₹10,000 + 18% GST (₹1,800 ITC) and sell the finished goods for ₹15,000 + 18% GST (₹2,700 Output GST), you pay only the net difference of ₹900 (₹2,700 − ₹1,800) in cash to the government.

Question 7

What are the standard GST slabs in India?

Accepted Answer

India operates primarily under four statutory GST slabs: 5% (essential goods, medicines, economy rail/air travel), 12% (processed foods, business computers, hotel rooms up to ₹7,500), 18% (standard rate for IT/telecom, commercial services, capital goods), and 28% (automobiles, air conditioners, aerated beverages, cement, luxury goods). In addition, special rates apply to precious metals (3% on gold/silver) and basic food staples are exempt (0%).

Item / Commodity	HSN / SAC	Category	GST Rate	Statutory Notes
Mobile Phones & SmartphonesAll cellular & smart mobile devices	8517	Electronics	18%	All cellular & smart mobile devices
Laptops, Desktops & TabletsAutomatic data processing machines	8471	Electronics	18%	Automatic data processing machines
Televisions (Smart TVs / LED)Up to 32 inches: 18%; above 32 inches: 28%	8528	Electronics	18%	Up to 32 inches: 18%; above 32 inches: 28%
Headphones, Earphones & SpeakersAudio accessories & microphones	8518	Electronics	18%	Audio accessories & microphones
Chargers, Power Banks & CablesStatic converters & charging adapters	8504	Electronics	18%	Static converters & charging adapters
Air Conditioners (ACs)Luxury home appliance slab	8415	Electronics	28%	Luxury home appliance slab
Gold Jewelry, Ornaments & CoinsSpecial 3% statutory precious metal slab	7113	Jewelry	3%	Special 3% statutory precious metal slab
Silver Articles & Bullion3% statutory bullion slab	7106	Jewelry	3%	3% statutory bullion slab
Jewelry Making Charges (Job Work)Job work on gold/gemstones billed separately	9988	Jewelry	5%	Job work on gold/gemstones billed separately
Cut & Polished DiamondsSpecial concessionary 1.5% slab	7102	Jewelry	1.5%	Special concessionary 1.5% slab
Rough Industrial DiamondsSpecial import 0.25% slab	7102	Jewelry	0.25%	Special import 0.25% slab
Fresh Vegetables & Fruits (Unbranded)Zero tax / exempt daily staple	0701	Food	0%	Zero tax / exempt daily staple
Fresh Milk & Unpackaged CurdUnpackaged fresh dairy products	0401	Food	0%	Unpackaged fresh dairy products
Pre-packaged & Labeled Rice/AttaPre-packaged pulses, flour, rice	1001	Food	5%	Pre-packaged pulses, flour, rice
Tea, Coffee & SpicesBranded packaged tea & coffee beans	0902	Food	5%	Branded packaged tea & coffee beans
Edible Cooking OilsMustard, sunflower, refined cooking oils	1507	Food	5%	Mustard, sunflower, refined cooking oils
Packaged Biscuits, Cakes & SnacksProcessed confectionery & bakery goods	1905	Food	18%	Processed confectionery & bakery goods
Chocolates & Cocoa ProductsCocoa preparations & premium chocolates	1806	Food	18%	Cocoa preparations & premium chocolates
Aerated Cold Drinks & Energy Drinks28% + 12% compensation cess	2202	Food	28%	28% + 12% compensation cess
Garments & Apparel (Sale Price ≤ ₹1,000)Affordable clothing threshold	6101	Apparel	5%	Affordable clothing threshold
Garments & Apparel (Sale Price > ₹1,000)Standard branded clothing	6101	Apparel	12%	Standard branded clothing
Footwear & Shoes (Sale Price ≤ ₹1,000)Affordable footwear tier	6401	Apparel	5%	Affordable footwear tier
Footwear & Shoes (Sale Price > ₹1,000)Branded shoes & leather footwear	6401	Apparel	12%	Branded shoes & leather footwear
Software Development & IT ServicesSaaS, coding, cloud hosting, IT consulting	9983	Services	18%	SaaS, coding, cloud hosting, IT consulting
Digital Marketing & AdvertisingSEO, Google/Meta ads, agency retainer	9983	Services	18%	SEO, Google/Meta ads, agency retainer
Legal & Advocate Services (Business B2B)Reverse Charge Mechanism (RCM) applies	9982	Services	18%	Reverse Charge Mechanism (RCM) applies
CA, Auditing & Tax ConsultingAccounting & compliance advisory	9982	Services	18%	Accounting & compliance advisory
Freelance Writing & Graphic DesignCreative & consulting services	9983	Services	18%	Creative & consulting services
Goods Transport Agency (GTA Logistics)5% without ITC; 12% with ITC	9965	Services	5%	5% without ITC; 12% with ITC
Restaurants & Dining (AC & Non-AC)5% flat without Input Tax Credit	9963	Hospitality	5%	5% flat without Input Tax Credit
Hotel Room Tariff (≤ ₹7,500 / night)Mid-scale accommodation	9963	Hospitality	12%	Mid-scale accommodation
Hotel Room Tariff (> ₹7,500 / night)Luxury hotel accommodation with ITC	9963	Hospitality	18%	Luxury hotel accommodation with ITC
Domestic Air Travel (Economy Class)Economy airline passenger transport	9964	Hospitality	5%	Economy airline passenger transport
Air Travel (Business / First Class)Premium airline cabin class	9964	Hospitality	12%	Premium airline cabin class
Life-saving Drugs & FormulationsInsulin, vaccines, diagnostic test kits	3004	Healthcare	5%	Insulin, vaccines, diagnostic test kits
General Pharmaceuticals & SyrupsStandard over-the-counter & prescription drugs	3004	Healthcare	12%	Standard over-the-counter & prescription drugs
Medical Devices & Diagnostic ScannersThermometers, BP monitors, ultrasound	9018	Healthcare	12%	Thermometers, BP monitors, ultrasound
Hospitalization & Doctor ConsultationsHealthcare clinical care is exempt	9993	Healthcare	0%	Healthcare clinical care is exempt
Affordable Under-Construction Housing1% flat without ITC (carpet area limits apply)	9954	Real Estate	1%	1% flat without ITC (carpet area limits apply)
Under-Construction Residential Flats5% flat without ITC	9954	Real Estate	5%	5% flat without ITC
Cement (Portland & Pozzolana)Heavy construction material slab	2523	Real Estate	28%	Heavy construction material slab
Steel TMT Bars & RodsStructural building reinforcement	7214	Real Estate	18%	Structural building reinforcement
Paints, Enamels & VarnishesSurface coating & interior finishes	3208	Real Estate	18%	Surface coating & interior finishes
Electric Vehicles (EV Cars & Scooters)Green mobility incentive slab	8703	Automotive	5%	Green mobility incentive slab
Motorcycles & Petrol ScootersStandard internal combustion two-wheelers	8711	Automotive	28%	Standard internal combustion two-wheelers
Commercial Trucks & Goods LorriesCommercial freight vehicles	8704	Automotive	28%	Commercial freight vehicles
Automobile Spare Parts & TyresVehicle components & replacement tyres	8708	Automotive	28%	Vehicle components & replacement tyres

GST Rate on SAC Code 9963: Restaurants, Dining & Food Delivery

What is the GST Rate on HSN 9963 (Restaurants, Cafes & Food Takeaway Services)?

Calculate GST for Restaurants, Cafes & Food Takeaway Services (5% Slab)

Calculation Parameters

GST Component Breakdown

GST Rates & HSN Code Finder (Top 50 Items)

Statutory Description & Scope

Invoicing Checklist (Section 31 CGST Act)

Frequently Asked Questions on HSN 9963

What is the GST rate on restaurant food bills under SAC 9963?

Is GST different for AC vs non-AC restaurants?

Related HSN / SAC Codes in Hospitality