Australia's goods and services tax (GST) is a flat 10%, but the maths trips people up in two different directions depending on whether you're starting from a price that already includes GST or one that doesn't.
Adding GST to a Price
If you have a GST-exclusive price, multiply it by 1.1 to get the GST-inclusive total. The GST component alone is the price multiplied by 0.1.
- Price excluding GST: $150.00
- GST: $150 × 0.1 = $15.00
- Total including GST: $150 × 1.1 = $165.00
Removing GST from a Price
If you have a GST-inclusive price and want to know how much of it is GST, divide by 11 — not by multiplying by 10%, which is the single most common GST mistake.
- Price including GST: $165.00
- GST: $165 ÷ 11 = $15.00
- Price excluding GST: $165 ÷ 1.1 = $150.00
Taking 10% straight off $165 would give $16.50 — noticeably more than the correct $15.00. The error happens because 10% is defined as a share of the pre-GST price, not of the total.
Why Division by 11?
Because the GST-inclusive price equals the exclusive price times 1.1. Rearranging that equation to solve for the GST component alone gives GST = inclusive price ÷ 11. It's a direct consequence of the 10% rate — at a different GST rate, that divisor would be a different number.
Who Actually Pays It
Registered businesses charge GST on their sales and remit it to the ATO, but they can claim back the GST they paid on their own business purchases as a credit — so the tax doesn't accumulate at each step. In practice, the end consumer is the one who ultimately bears the full 10%.
Skip the arithmetic entirely with our GST Calculator Australia, which adds or removes GST from any amount instantly.
Sources: ATO — GST.