the cost of an item is rupees 800 the customer have to pay an additional 18% GST on the cost of this item. find the GST paid by the customer also find the total amount paid by the customer
Answers
Step-by-step explanation:
GST Calculator is an effective tool that can be used to determine the amount of tax applicable on different products and services. The tool essentially helps you find out how much a product or service would cost after the application of GST.
GST, which is short for Goods and Services Tax, is an indirect tax system that came into effect on July 1, 2017. It is a comprehensive, destination-based, multi-stage tax levied at every value addition. The new tax regime has replaced a number of indirect taxes that were previously in place. GST is a single indirect tax for the whole nation, conceived on the principle of 'one nation, one tax, one market'.
GST is paid at the time of procurement of goods and services and set off against that payable on the supply of goods or services. The wholesaler or manufacturer or retailer will incur the applicable GST rate, but can later claim it back via the tax credit mechanism. This ultimately means that every seller recovers the tax from buyers, thus placing the burden of taxes on those who are the end users of goods and services.
Formula for GST calculation
To find out the how GST affects the price of a product or service, all that one needs to do is input into the tool the original cost of the product or service and the GST rate applicable - 5%, 12%, 18% or 28%. Based on this data, the calculator will show how much one would need to pay as GST for a product or service.
The formula for GST calculation is as under:
GST Amount = (GST x Original cost of the product or service) / 100
Net Price = Original cost of the product or service + GST amount
To remove GST:
GST Amount = Original cost of the product or service - [Original cost of the product or service x {100 / (100 + GST%)}]
Net Price = Original cost of the product or service - GST amount
Impact of GST on Product Pricing
GST rates range from 0% to 28%. The government has put into place five different tax slab under which all products and services are listed. They are 0%, 5%, 12%, 18% and 28%. Many essential goods are not taxed at all, while the luxury items are taxed at the higher rate i.e. 28%.
At the time of introducing GST, Finance Minister Arun Jaitley had said that the government intended to keep the new tax rates close to the original rates. However, there would be a difference in some cases as a result of the changes in the economy. Some commodities were placed in the high tax bracket i.e. 18% and 28%, however after scrutinizing the list, the government decided to mark certain commodities as necessities and not luxuries. Hence, the GST rates have been revised for some of the commodities.
Here is a look at some of the recent changes in the rates of goods and services
Answer:
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