GST Rates in India: Slabs, HSN/SAC Codes & Special Cases
By AZ Utils Editorial · · 8 min read
Not everything is taxed at 18%. India's GST uses a tiered slab system, and knowing which rate applies to your product or service is the difference between a correct invoice and a costly mistake. This guide explains the GST rates in India, what falls into each slab, how to find the right rate using HSN/SAC codes, and the special cases like zero-rated supplies and cess.
It's a practical reference for business owners, freelancers, students and anyone trying to work out the correct GST on a sale.
Key Concepts: The GST Slab System
GST is levied at fixed percentage slabs rather than a single flat rate, so essentials are taxed lightly (or not at all) while luxury goods are taxed heavily. The main slabs are:
| Slab | Typically applies to |
|---|---|
| 0% (exempt / nil) | Essential items such as fresh produce and certain unbranded staples |
| 5% | Mass-consumption goods and household necessities |
| 12% | Processed foods and some electronics |
| 18% | The most common slab — most services and many goods |
| 28% | Luxury and "sin" goods, often with an additional cess |
Exact classifications change over time and by notification. Always confirm the current rate for your specific item.
In short: GST in India is charged across slabs — commonly 0%, 5%, 12%, 18% and 28% — with the correct rate for an item determined by its HSN (goods) or SAC (services) code.
How to Find the Right Rate: HSN & SAC Codes
- HSN (Harmonised System of Nomenclature) codes classify goods. Each code maps to a GST rate.
- SAC (Services Accounting Code) codes classify services similarly.
To find your rate, identify the HSN/SAC code for your product or service, then look up the notified rate for that code. This is also what you print on a compliant tax invoice.
Special Cases You Should Know
- Zero-rated supplies — exports and supplies to SEZs are typically zero-rated, allowing input credit refunds.
- Exempt supplies — nil-rated; no GST charged, but input credit generally can't be claimed.
- Compensation cess — an extra levy on top of 28% for certain luxury/sin goods.
- Reverse charge — in some cases the recipient, not the supplier, pays the GST.
Step-by-Step: Applying the Right Rate
- Identify whether you're supplying a good or a service.
- Find its HSN/SAC code.
- Look up the current notified slab for that code.
- Apply it with the GST Calculator — select the slab and add or remove GST.
Try Our Free GST Calculator
Once you know the slab, our free GST Calculator applies it instantly and shows the tax and CGST/SGST split.
- ✅ Choose 5%, 12%, 18%, 28% or a custom rate
- ✅ Add or remove GST
- ✅ Automatic CGST + SGST split
- ✅ Free, no sign-up
Real-World Examples
Example 1 — A restaurant meal
A standalone restaurant meal commonly attracts 5% GST. A ₹2,000 net bill → ₹100 GST.
Example 2 — A professional service
Consulting services typically fall at 18%. A ₹50,000 fee → ₹9,000 GST.
Example 3 — A luxury item
A 28%-slab product priced at ₹1,00,000 net attracts ₹28,000 GST, plus any applicable cess.
Common Mistakes to Avoid
- Assuming everything is 18%. Slabs vary widely; check the code.
- Putting a product and its accessory in the same slab when they differ.
- Forgetting cess on certain 28% goods.
- Treating exempt and zero-rated as identical — their input-credit treatment differs.
- Using outdated rates after a notification change.
Best Practices
- Map every item to its HSN/SAC code and record the slab.
- Re-verify rates periodically, as classifications are updated by notification.
- Print HSN/SAC and the rate on invoices for compliance.
- Consult a tax professional for borderline classifications.
Frequently Asked Questions
What are the GST rate slabs in India?
The common GST slabs are 0% (exempt), 5%, 12%, 18% and 28%, with an additional compensation cess on certain luxury and sin goods.
How do I know which GST rate applies to my product?
Identify the product's HSN code (or SAC code for services) and look up the current notified GST rate for that code.
What is the most common GST rate?
18% is the most common slab and applies to most services and many goods.
What is the difference between zero-rated and exempt supplies?
Zero-rated supplies (like exports) are taxed at 0% but allow input tax credit refunds. Exempt supplies have no GST but generally do not allow input credit.
What is GST compensation cess?
It is an additional levy charged on top of the 28% slab for specific luxury and sin goods, over and above the standard GST.
Conclusion
India's GST slabs exist to tax essentials lightly and luxuries heavily — and the correct rate for any item is decided by its HSN or SAC code, not a guess. Identify the code, confirm the current slab, watch for cess and zero-rated cases, then calculate with confidence.
👉 Calculate GST at any rate now →
Related Resources
- How to Calculate GST — the formulas
- GST for Small Businesses — registration, invoicing & returns
- GST Calculator: Complete Guide — the full how-to
