GST Rate Slabs, Registration and the Tax Invoice

Rate slabs. GST is not charged at one single rate on everything — different goods and services are placed under different rate slabs depending on their nature, with essential goods taxed lightly or exempted altogether and luxury or sin goods taxed the highest. The well-known slabs that have been used since GST's introduction are 0%, 5%, 12%, 18% and 28%, with a few goods (such as certain luxury and sin goods) also attracting an additional cess on top of the 28% slab. A student should treat these numbers as the broad, well-established structure rather than a fixed, unchanging table — the GST Council reviews and can revise rates and the goods placed under each slab from time to time, and an accountant always applies whatever rate is currently notified for a given good or service.

Registration. Not every person carrying on business is required to register under GST — the law prescribes a threshold limit of aggregate turnover, below which registration is optional. A business whose turnover crosses the prescribed threshold in a financial year must register, obtain a GSTIN (GST Identification Number), and thereafter charge GST on its supplies and file periodic returns. Businesses below the threshold may still register voluntarily, most commonly so that they too can claim input tax credit on their purchases and can supply to registered buyers who want to claim credit in turn. A small trader who genuinely prefers a simpler, lower flat-rate payment instead of full ITC-based GST may also be eligible for a simplified composition scheme, subject to conditions and turnover limits laid down under the law. …