### Understanding the Calculation of GST

Calculating the Goods and Services Tax (GST) on goods or services is straightforward with a simple mathematical formula. Here’s how you can determine the GST amount and the total cost inclusive of GST.

#### The GST Calculation Formula

The formula to calculate GST is:

[ \text{GST} = \left(\frac{\text{Price of goods or services} \times \text{GST rate}}{100}\right) ]

In this formula:

**Price of goods or services**: The original cost of the item or service before GST.**GST rate**: The applicable GST percentage.

#### Example Calculations

Let’s walk through some examples to see how this formula works in practice.

**Example 1: Calculating GST at 18%**

Imagine you bought a product worth ₹100 and the GST rate is 18%.

- Calculate the GST amount:

[ \text{GST} = \left(\frac{₹100 \times 18}{100}\right) = ₹18 ] - Add the GST amount to the original price to get the total cost:

[ \text{Total price} = ₹100 + ₹18 = ₹118 ]

**Example 2: Calculating GST at 12%**

Now, consider the same product priced at ₹100, but with a 12% GST rate.

- Calculate the GST amount:

[ \text{GST} = \left(\frac{₹100 \times 12}{100}\right) = ₹12 ] - Add the GST amount to the original price:

[ \text{Total price} = ₹100 + ₹12 = ₹112 ]

**Example 3: Calculating GST at 28%**

Lastly, let’s use a 28% GST rate for the same product.

- Calculate the GST amount:

[ \text{GST} = \left(\frac{₹100 \times 28}{100}\right) = ₹28 ] - Add the GST amount to the original price:

[ \text{Total price} = ₹100 + ₹28 = ₹128 ]

### Applying the GST Formula to Other Rates

You can use the same formula to calculate GST for any rate. Simply substitute the **Price of goods or services** and the **GST rate** into the formula:

[ \text{GST} = \left(\frac{\text{Price of goods or services} \times \text{GST rate}}{100}\right) ]

This method ensures you accurately compute the GST amount and the final price, helping you manage your finances better. Whether you’re a consumer calculating the total cost of your purchase or a business owner determining the correct price to charge, this straightforward formula is invaluable for ensuring compliance and transparency in pricing.

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