Tax Inclusive Pricing
Also called: inclusive of tax, GST inclusive
What is Tax Inclusive Pricing?
Tax inclusive pricing means the price shown to the customer already contains GST, so the bill total equals the menu or shelf price. The tax is then extracted from that figure rather than added on top.
Why Tax Inclusive Pricing matters
Menus, retail shelf tags and consumer-facing price lists usually work best inclusive, because customers dislike a total that grows at the counter. But the taxable value still has to be backed out correctly for your returns.
Tax Inclusive Pricing formula
Taxable value = Inclusive price × 100 ÷ (100 + GST rate)
The GST amount is the inclusive price minus that taxable value.
How Tax Inclusive Pricing works in practice
To extract tax from an inclusive price, divide by one plus the rate. Where a business sells at multiple rates, doing this per line rather than on the bill total is the only way the split stays accurate.
Worked example
A ₹236 inclusive price at 18% breaks down to ₹200 taxable value and ₹36 GST.
Frequently asked questions
Menus commonly show inclusive prices for a cleaner customer experience, while the bill still shows the tax split.