What is GST in India – Complete Guide, Rates & Registration Process

By EMI Toolbox • 2025-08-14

What exactly is GST?

Goods and Services Tax (GST) is India's extensive indirect tax system which was replaced by a variety of tax systems in 2017. GST is an multi-stage tax based on the destination assessed on every value-added item within the supply chain from the manufacturer to the consumer.

The tax is based on the principle in "One Nation, One Tax," creating an unifying market throughout India. In GST taxes, taxes are paid at each step in the chain of supply however, businesses are able to claim tax credits for tax paid on inputs which ensures that only value added is taxed every stage.

The Key Specifics of GST

GST is an tax structure that is dual comprising three components:

CSS0_ (Central GST): 50% of GST on sales made within states which is that is collected from the central government
GST/UGST (State/Union Territory GST): 50% of GST on sales within states that are collected by the state/UT governments.
GST (Integrated GST): 100% GST on sales between states, taken by the central government, and then distributed to the consuming states.

GST Rate Structure

GST is taxed at different rates that are based on the nature of services and goods:

GST Rate	Category	Examples
0%	Essential goods	Fresh fruits milk, vegetables Books, educational and other services
5%	Daily needs	Sugar, packaged foods tea, medications and fertilizers
12%	Basic items	Computers, processed foods umbrellas ayurvedic medicines
18%	The majority of goods and services.	Electronics, restaurants, IT services, soaps, furniture
28%	Items of luxury	Cars, AC, refrigerators, tobacco, luxury goods

What is an GST Calculator and who is the beneficiary?

An GST calculator is a tool that instantly calculates GST amounts and provides exact calculation to calculate CGST, SGST, and IGST. The calculators can support GST-inclusive as well as GST exclusive calculations on all Indian GST rates.

The main benefits of GST Calculators

Speed-Saving, Accuracy and Time GST calculators give immediate outcomes and remove human calculation mistakes. They automatically divide taxes between CGST/SGST in intra-state transactions and IGST for interstate transactions.

business applications Calculators that are helpful to:

Invoice generation and pricing decision
Budgeting and financial planning
Reporting and compliance with taxes
The determination of net or gross prices for products
Differentiating between various GST components

Universal Usage: GST calculators benefit various stakeholders:

Wholesalers and producers for pricing of products and services
Retailers for customer billing and management of inventory
Services providers For professional service billing
Small-sized companies to simplify tax calculations, without complicated manual calculations

How GST Calculation Functions

GST Exclusive Calculation:

GST Amount is (Value of supply * GST%)/100
The Total Cost = the value of Supply + GST Amount

GST Inclusive Calculation:

GST Amount = Total ]

How do I get GST Number? GST Number?

The registration for GST has become required for all businesses that have an annual turnover greater than 20 lakh (Rs10 lakh for states that fall into special categories). The process of registration is entirely online and is free.

Step-by-Step GST Registration Procedure

Part A: Initial Application

Visit the official GST Portal at www.gst.gov.in
Click "Services" → "Registration" → "New Registration"
Choose "Taxpayer" on the drop-down menu.
Select your state/UT, district and district
Input the legal name of your business according to the PAN database
Give your business's PAN number
Enter the primary email address of the authorized signatory
Provide valid mobile number
Complete the captcha verification, then click "Proceed"
Receive a TRN or Temporary Reference No. (TRN) via SMS and email.

Part B: Complete Application

Login using the TRN that you have received
Enter Captcha and TRN, click "Proceed"
Check OTP sent to registered email address and mobile
Open "My Files Application" and click on the Edit icon
Fill in the 10 sections and provide information about your business:

Constitution and business details
Partner information and promoters
Signature authorization information
Additional business and principal places of business
Details on goods and services
Specific information for the state
Aadhaar authentication
Document confirmation

Upload the application using a Digital Signature (DSC)
Receive an Application Reference (ARN) confirmation of the application

Essential Documents to be used for GST Registration

Documents essential to have include:

PAN card of the business/proprietor
Aadhaar card issued by a signatory authorized
Certificate of registration for business
Address proof of the business's premises
Bank statement/cancelled cheque
Photos of individuals who are authorized
Partnership deed/MOA & AOA (for partnerships/companies)

How do I download GST Certificate?

After GST registration has been approved, businesses will receive GST Registration Certificates. GST Registration Certificate on Formula GST REG 06. This certificate is legally valid evidence that a business has registered for GST registration and is required to be prominently displayed on every business establishment.

Step-by-Step download process

Go to the GST Portal at www.gst.gov.in
Login using your GSTIN credentials
Go to "Services" → "User Services" → "View/Download Certificates"
Choose the type of certificate (GST registration certificate)
Click on "Download" next to your certificate.
Download the certificate in a PDF file

Important Certificate Details

The GST certificate contains:

GSTIN (GST Identification Number): Unique 15-digit identifier
Legal business and trade names
Type of registration and the date
Principal and other business addresses
The nature of business activities
Signatory authorization details

Requirements for Displaying Certificates

Legal Compliance: Businesses that are GST registered have to display the certificate of registration prominently in their main as well as other places of business. Failure to display the certificate could be a cause for disciplinary actions.

Digital Format only: The government issues the certificate only digitally on the GST portal. No physical certificates are issued.

The benefits of GST System

Economic Benefits

GDP growth: GST implementation is predicted to boost India's GDP by 1.5–2%.
Removal of Cascading Effect: Avoids "tax in tax" by granting full input tax credits.
Unified Tax Structure: Brings consistent rates across India.

Business Benefits

Simple Compliance: All GST procedures are handled via a single website.
Higher Registration Limit: 20 lakh limit benefits small-scale firms.
Increased competitiveness: Lower costs and removal of state barriers.
Technology Driven System: e-verification and ITC matching for transparency.

Consumer Benefits

Price reduction: Lower costs due to elimination of cascading taxes.
Greater Transparency: Consumers now know exact taxes they pay.
Higher Quality Product: Encourages firms to improve quality.

Conclusion

GST is one of the most significant tax reforms in India that has transformed the country's indirect tax landscape with GST's "One Nation, One Tax" framework. It has unified various indirect taxes into a single technology-driven system benefiting consumers, businesses, and the economy.

For companies: GST offers simplified processes, removes cascading taxes, and improves competitiveness.
For the economy: Creates a unified market, improves efficiency, and is predicted to boost GDP growth.

While initial implementation had challenges, GST has evolved with technology like AI and ML for better compliance. Staying compliant, using tools like GST calculators, and keeping updated with changes ensures smooth operations in India's new tax system.