Goods and Services Tax

Goods and Services Tax (GST) is a tax on most goods, services and other items sold.

How is GST Calculated?

GST is a fixed 10% of the purchase price on most goods and services.

Sale price =1.1\times purchase price

Example 1

What is the sale price (including GST) of a chair that has a pre-GST price of $200.

Sale price =1.1\times purchase price
Sale price =1.1\times 200
Sale price =220

The sale price of the chair is $220.

Example 2

What is the pre-GST price of a $400 table?

Make pre-GST price the subject of the equation.

Pre-GST price=\dfrac {sale price}{1.1}
Pre-GST price=\dfrac {400}{1.1}
Pre-GST price=363.6364

The price of the table before GST is $363.64

See also

Capital Gain