General information, not professional advice. GST rules, rates and due dates change by notification. Check the current position on the GST Portal or with your CA before you act on anything here.
The short version
- Most goods and services now fall in 5% or 18%, with 40% reserved for a small set of items.
- Special rates remain: 3% and 0.25% for precious metals and stones, and a long exempt list at 0%.
- The rate follows the HSN classification of the item, not the type of shop selling it.
- Packaging and branding change the rate for many foods: loose and unbranded is often exempt where pre-packaged and labelled is taxed.
- Rates change by notification, so check a specific item rather than relying on a remembered slab.
The slabs today
The rationalisation notified in September 2025 collapsed the old four-slab structure. In practice you now deal with:
| Rate | Broadly covers |
|---|---|
| 0% | Exempt items: many unbranded staples, fresh produce, unprocessed milk, and a long notified list |
| 5% | Everyday goods and essentials, most packaged food, many services that were at 12% |
| 18% | The general rate for most goods and services |
| 40% | A small set of goods kept at a high rate |
Items that used to sit at 12% and 28% were largely redistributed into 5% and 18%, which is why a price list built before that date will quietly be wrong.
Special rates
- 3% on gold, silver and articles of precious metal
- 0.25% on rough diamonds and certain precious stones
- 1.5% on a narrow set of items
- Compensation cess on a few categories, charged on top of the rate
How the rate is decided
By the classification of the goods under their HSN code, or of the service under its SAC. Not by who sells it, not by the price, and not by the shop's category. Two products that look similar in a shop can sit in different headings, which is why the code matters more than the label.
Why the same item has two rates
For a lot of food, the rate turns on whether the item is pre-packaged and labelled. Loose atta scooped from a sack and branded atta in a printed bag are the same flour and different tax. The same logic catches pulses, rice, paneer, dried fruit and more. Some garments and footwear switch rate above a value threshold instead.
If you sell both loose and packaged versions, they are two lines in your catalogue with two rates, not one line you adjust by memory.
Services and SAC
Services use six-digit SAC codes beginning 99. Salon and personal-care services, repair and maintenance, tailoring on customer-supplied fabric, transport, professional services: each has its own code and rate, and several moved in the same rationalisation.
Checking one item
A slab table is a starting point, never the answer for a specific product. Two ways to check:
- Our HSN and GST rate finder: search the item the way you say it, in Hinglish, Hindi or English, and see the code, the rate and the condition that changes it. It covers 362 everyday items and is anchored to the CBIC schedules.
- The CBIC rate finder on the government site, which is authoritative and what you should use for a filing decision.
Rates on the bill
In AawazAI, each product in your catalogue carries its HSN or SAC and its rate, and the rates are date-effective, so a bill you raise for last month uses last month's rate rather than today's. New items get a suggested code and rate that you confirm once, and every invoice then applies it without anyone remembering a slab.
Never look up a rate mid-sale
Your catalogue in AawazAI carries the HSN or SAC and the rate for each item, date-effective, so the bill applies the right one without anyone checking a table.
Frequently asked questions
What are the current GST rates in India?
After the September 2025 rationalisation the main slabs are 5% and 18%, with 40% for a small set of goods and 0% for exempt items. Special rates of 3% and 0.25% continue for precious metals and stones, with compensation cess on a few categories.
Which GST rate applies to my product?
The one attached to its HSN classification. Search the item in our HSN and GST rate finder for the code and rate, and confirm on the CBIC rate finder before you rely on it for a filing.
Why do loose and packaged goods have different GST rates?
Because for many food items the rate depends on whether the item is pre-packaged and labelled. Loose or unbranded versions are often exempt while the packaged version is taxed, so they belong in your catalogue as two separate items.
Did GST rates change in 2025?
Yes. The rate structure was rationalised with effect from 22 September 2025, moving most items into 5% and 18% and keeping 40% for a limited set. Price lists and product masters made before that date need checking.
Is GST charged on the price before or after discount?
On the taxable value after any discount shown on the invoice. Discounts agreed after the sale are handled through a credit note, subject to the conditions in the contract.