GST Rates in 2024 - Goods and Service Tax Rates

GST or Goods and Service Tax is the newest form of indirect tax established in July 2017 in India. The implementation of GST has resulted in the replacement of multiple indirect taxes such as VAT (Value Added Tax), general service taxes, excise duty, added cess, and much more. The establishment of a single indirect tax scheme has streamlined the taxation process on products. 
Moreover, it has also brought uniformity and lowered tax-related crimes to a significant level.

The uniformity and elimination of confusion through a unified taxation scheme have provided an essential boost to the economy. Every state in India lists their GST collection over a particular financial year. It has been seen that, with every passing year, the GST collection and the subsequent revenue generation for the government has increased significantly. 
As a result, the complete boost in the economy has been game-changing, just because of the Goods and Service Tax.

Every financial year, when the union budget is presented by the finance minister, the changes in the slabs of GST are mentioned thoroughly. Different businesses and products charge different rates of GST depending on the decided rate in the budget.

Usually, the GST Council manages and determines the GST slab rates for various items and products. However, only the finance minister can declare the rate slabs in the budget. As a normal rule, the GST implied on luxurious items is more. On the other hand, GST rates implied on necessary and day-to-day items are less. Over the years since its inception, the rates of GST on various items have been revised or changed multiple times.

GST Slab Rates

As of now, the government and GST council follow four specific GST slab rates. The slab rates are mentioned below

    • 5%

    • 12%

    • 18%

    • 28%

Apart from these general slab rates, very few items also follow 3% and 0.25% GST rates.

Types of GST in India

Since the core scheme of GST is quite elaborate, direct charging of taxes by a single authority is difficult to manage. In light of that situation, the government along with the GST Council had decided to divide the GST scheme into three different levels or categories. This decision was taken and levied as soon as GST was implemented in the country.

The three categories of GST are:

• SGST:
  SGST or State Goods and Service Tax, otherwise known as Intra-State Goods and Service Tax is the GST levied on a product or service transactions within a particular state. The revenue earned by collecting SGST is directly deposited into the state’s treasury and accounts for the particular state’s economic growth.  
  SGST is usually accompanied by CGST and is halved when calculated. For example, for a product that has 18% GST levied on it, 9% goes as SGST and the other 9% goes as CGST.
   
• CGST:
  CGST or Central Goods and Service Tax is the GST levied on products and services that are transacted within a particular state or union territory. However, the collected revenue from CGST is deposited directly in the central government’s treasury. Quite naturally, it accounts for the economic growth of the nation. 
  As mentioned before, CGST is usually accompanied by SGST or UGST and always collects half the tax of the total levied rate. 
   
• IGST:
  IGST or Integrated Goods and Service Tax is the GST levied on products and services that are transacted between two states or inter-state. Apart from general goods and services, IGST is also applicable to goods that are imported and exported. The revenue collected from IGST goes solely to the central government. There is no sharing of the collected amount between the state and central government. 
  For example, if a product has a GST rate of 18%, all of it goes to the central government’s treasury and contributes to the national economy. 
   
• UGST:
  There is a fourth, less used type of GST known as UGST or Union Territory Goods and Service Tax. The UGST is similar to the SGST, and as the name suggests, it is applicable for transactions in a union territory instead of a state. The working process and division of revenue are also similar to the concept of SGST. 

GST Slabs for Various Items

As mentioned earlier, the various GST slab rates house different items, products, and services. Some of the common items under each slab are mentioned below. 

5% Slab

    • Sugar

    • Tea

    • Coal

    • Coffee beans

    • Edible oils

    • Domestic LPG

    • Clothing and footwear

    • Life-saving drugs

    • Sweets

    • PDS Kerosene

12% Slab

    • Butter

    • Ghee

    • Computer

    • Mobiles

    • Umbrella

18% Slab

    • Pasta

    • Corn flakes

    • Soap

    • Ice cream

    • Toothpaste

    • Hair oil

    • Gaming computers

    • Toiletries

    • Soups

    • Printers

28% Slab

    • Small cars (cess- 1-3%)

    • High-end motorcycles (cess- above 15%)

    • Air conditioner

    • Refrigerators

    • Luxury cars 

    • Aerated drinks (cess-above 15%)

Conclusion

GST has helped many businesses thrive in the current-day market. Specifically, small and medium-scale businesses have benefited the maximum from a unified and transparent taxation regime. Apart from that, the national GDP (Gross Domestic Product), which is a measure of the economic wellness of a country, has also taken a positive boost.