Ask the internet how many GST slabs India has and you get a confident answer: four. Zero, 5%, 18% and 40%, ever since the big rate rework of September 2025. Ask the Gazette of India instead and the answer changes. 12% is still a live GST rate. So are 3%, 1.5% and 0.25%. If your shop sells bricks or roofing tiles, or anything a jeweller sells, this is not trivia. And if your billing software believed the internet, you may have a bill you cannot raise at all.
What actually changed in September 2025
The GST Council's 56th meeting, held in New Delhi on 3 September 2025, recommended moving most goods onto two main rates, 5% and 18%, with 40% for a short list of luxury and demerit goods. The changes took effect from 22 September 2025. The coverage, reasonably enough, called it the end of the 12% and 28% slabs, and "four slabs" has been the standard line ever since.
But rates are made by notification, not by headline. The rework arrived as Notification No. 9/2025-Central Tax (Rate), dated 17 September 2025, which replaced the original rate notification of 2017. Count the schedules in it and you do not get four. You get seven. On the bill, after adding the state half to the central half the notification prints, they read:
- Schedule I: 5% on the bill (2.5% central + 2.5% state). Most everyday goods.
- Schedule II: 18%. The standard rate.
- Schedule III: 40%. The luxury and demerit list.
- Schedule IV: 3%. Headings 7101 to 7118: pearls, silver, gold, platinum, jewellery, imitation jewellery, even coin.
- Schedule V: 0.25%. Rough diamonds and unworked precious and semi-precious stones.
- Schedule VI: 1.5%. Diamonds and stones other than the rough ones in Schedule V. Broadly, cut and polished.
- Schedule VII: 28%. Pan masala and tobacco, held at the old rate for a while longer. More on this below, because its ending has a date most articles get wrong.
One reading habit worth forming while we are here: a Central Tax (Rate) notification states only the central half of each rate. Schedule IV literally says 1.5%, and that means 1.5% CGST plus 1.5% SGST, 3% on the customer's bill. If you ever check a notification yourself, double the printed figure.
Where 12% survives
The 12% rate did not survive inside Notification 9/2025. It survived beside it. On the same day, the government issued Notification No. 14/2025-Central Tax (Rate), dated 17 September 2025, a standalone levy of 6% central tax, 12% with the state half, on exactly four entries:
- 6815: fly ash bricks, fly ash aggregates, fly ash blocks
- 6901 00 10: bricks of fossil meals or similar siliceous earths
- 6904 10 00: building bricks
- 6905 10 00: earthen or roofing tiles
That is the whole list, in force from 22 September 2025. It is not "construction materials" broadly: cement sits in Schedule II at 18%. Four tariff lines. But if you run a hardware or building materials shop, those four lines may cross your counter every day, and a rate list without 12% cannot bill a single one of them correctly.
And 28%? Gone, but in February 2026, not September 2025
Notification 9/2025 kept Schedule VII at 28% for pan masala, tobacco and cigarettes; the Council had said those goods would move later. They moved on 1 February 2026. Notification No. 19/2025-Central Tax (Rate), dated 31 December 2025 omits Schedule VII and every entry in it from that date, sending biris to Schedule II at 18% and pan masala, cigarettes and other tobacco to Schedule III at 40%. So 28% really is dead, but it died more than four months after the date most of the coverage gives. A paan shop or general store selling these goods billed them at 28% right through January 2026, correctly, and software that dropped the rate in September was wrong for over four months.
Why this is a billing software problem
Now the part that puts this article on a software company's blog instead of a CA's. In billing software a GST rate is not a piece of trivia, it is a doorway. You pick a rate when you create a product. Every invoice line carries it. And GSTR-1, the return of your outward supplies, is built rate-wise: B2B invoices report the rate on each line, B2C sales are consolidated by rate, and the HSN summary wants a rate against every code. (We have written before about where GSTR-1 uploads actually fail.) If a rate does not exist in the software's list, the product cannot be created, the invoice cannot be raised, and the return cannot be filed as the law expects. A brick seller with a four-slab rate picker is not inconvenienced. He is stopped.
There is a quieter version of the same failure. A shop that bought stock at 28% before February 2026 still has purchase records at that rate, and may yet see a credit note against one. Software that deletes a retired rate, instead of keeping it readable on old documents, mangles history it once recorded correctly.
We are not writing any of this from a safe distance. On 7 August 2026 we removed 12% from the rate picker in Layerdots ERP because we believed the slab was gone. We had read the coverage, not the notification. On 18 August 2026 we checked Notification 14/2025 itself, saw four tariff lines still levied at 12%, and restored the rate the same day, along with 3%, 1.5% and 0.25%, which our list had also lost. Our rate list said, in effect, that a building brick could not exist. No customer reported it before we caught it, which is luck, not a defence. And to be exact rather than flattering about it: the correction is written but it is not yet in the version you can download. The shipping build, 2.9.1, still carries the four-slab list. The restored rates go out in the next release. We would rather say that here than let this read as a problem we have already finished with.
The full list a rate picker needs today
As of August 2026, a retail rate list that matches the notifications carries eight rates: 0%, 0.25%, 1.5%, 3%, 5%, 12%, 18% and 40%. In the corrected Layerdots list the trade-specific ones carry a plain note, "12% · bricks, roofing tiles" and "3% · gold, silver, jewellery", so a kirana or a chemist cannot land on a jeweller's rate by a slip of the finger. 28% is not offered on new products, but a bill or purchase that carries it from before February 2026 still displays exactly as it was recorded.
Common questions
Is 12% GST still applicable in 2026?
Yes, under Notification 14/2025-Central Tax (Rate) dated 17 September 2025: fly ash bricks,
aggregates and blocks (6815), bricks of fossil meals (6901 00 10), building bricks (6904 10 00)
and earthen or roofing tiles (6905 10 00). Everything else that used to sit at 12% moved,
mostly to 5% or 18%.
Is gold still taxed at 3%?
Yes. Schedule IV of Notification 9/2025 covers headings 7101 to 7118 at 3% on the bill. Rough
diamonds and unworked stones are at 0.25% under Schedule V, other diamonds at 1.5% under
Schedule VI. None of these moved in September 2025.
When was the 28% slab actually removed?
On 1 February 2026, by Notification 19/2025-Central Tax (Rate) dated 31 December 2025, which
omitted Schedule VII. Biris went to 18%; pan masala, cigarettes and other tobacco went to
40%.
My billing software no longer offers 12%. What should I do?
If you sell any of the four headings, ask your vendor to restore the rate and point them at
Notification 14/2025. Do not work around it by billing at 18%, which charges your customer tax
the law does not ask for, or at 5%, which short-pays it. Either way the wrong rate flows into
GSTR-1 and becomes a wrong return.
This article is general information for shop owners, not legal advice, and rates change by notification. Figures verified against Notifications 9/2025, 14/2025 and 19/2025-Central Tax (Rate) as of 19 August 2026. For a dispute or a notice, speak to your CA or a GST practitioner.