Blog  /  26 June 2026

GST Rate Changes — New Slabs Explained for Shop Owners

GST rates are reviewed periodically by the GST Council, and changes can affect what you charge customers, what you pay suppliers and how you set product prices. Here is a plain-language guide for shop owners on how GST slabs work, how to track changes, and how to update your billing the moment a rate moves.

Important: GST rates are revised by the GST Council and notified through official circulars. Always confirm the exact rate for your products on the official CBIC/GST portal or with your tax advisor before applying it. This guide explains how the slabs work and how to keep your billing in step — it is not a substitute for the latest notification.

How the GST slab system works

GST in India is built around a small set of standard slabs. Most goods and services fall into one of these:

Slab	Typical use
0% (exempt / nil)	Unbranded staples like fresh produce, unpackaged grains, milk
5%	Essential and mass-consumption packaged goods
12%	Standard-rate goods and some processed items
18%	Most goods and services — the largest bucket
28%	Luxury and "sin" goods, often with an additional cess

When the GST Council meets, it can move a product from one slab to another, correct an inverted duty structure, or clarify the rate for a disputed category. For a shop owner, the practical impact is that the GST you must charge on a specific item can change — sometimes up, sometimes down.

Why rate changes matter for your shop

• Your selling price changes. If a product moves from 12% to 5%, your MRP-inclusive price may need adjusting, or your margin improves. The reverse squeezes margin if you do not update prices.
• Your invoices must show the correct rate. Charging an outdated rate creates mismatches in your GST returns and can lead to short payment or excess collection.
• Input tax credit is affected. A change on items you buy alters the credit you can claim, so your effective cost shifts.
• Customer expectations. When a popular product's GST drops, customers notice and expect the benefit passed on.

How to find the right GST rate for a product

Every product has an HSN code, and the GST rate is tied to that code. The reliable way to confirm a rate is to look up the product's HSN code and check the current notified rate against it. You can use our free HSN / SAC code finder to locate the code for what you sell, then verify the rate on the GST portal.

Once you know the correct rate, the GST calculator helps you work out the tax-inclusive and tax-exclusive amounts, plus the CGST/SGST split, in seconds. If you want the full method behind those numbers, our guide on how to calculate GST on an invoice explains it step by step.

Updating your billing when a rate changes

If you bill on paper or in a spreadsheet, a rate change means manually re-checking every affected item — slow and error-prone. With software, you change the GST rate once on the product and every future invoice picks it up automatically.

In Ledgerly's GST billing app, each product stores its own GST rate. When the Council revises a rate, you edit the product once, and the new rate flows into billing, reports and your tax summaries from that point on. This is the simplest way to stay compliant without re-learning your whole catalogue every time the slabs move.

A simple checklist for the next rate change

1. Note which of your products are affected by the notification.
2. Confirm the new rate against the product's HSN code on the GST portal.
3. Update the GST rate on those products in your billing software.
4. Review your selling prices — decide whether to pass on the change or adjust margin.
5. Inform regular customers if a popular item's price changes noticeably.
6. Check your next GST return reflects the updated rates correctly.

Frequently Asked Questions

Who decides GST rate changes?

The GST Council, chaired by the Union Finance Minister with state representatives, recommends rate changes. These are then notified by the government through official circulars before they take effect.

How do I know the current GST rate for my product?

Find your product's HSN code and check the latest notified rate against it on the official GST/CBIC portal. Our HSN/SAC code finder helps you locate the code quickly, and a tax advisor can confirm edge cases.

What happens if I charge an old GST rate after a change?

Charging an outdated rate causes mismatches in your GST returns — you may collect too little or too much tax, which has to be reconciled and can attract interest or penalties. Updating rates promptly avoids this.

Does Ledgerly update GST rates automatically?

Ledgerly stores a GST rate per product so a change only needs to be made once on that product. After you set the new rate, every future invoice and report uses it automatically — you do not edit each bill by hand.