GST-inclusive vs exclusive pricing
Australian Business & ComplianceAlso: GST-inclusive pricing · GST-exclusive pricing
Quick definition
GST-inclusive pricing shows the total price a buyer pays with the tax already inside it. GST-exclusive pricing shows the price before tax, with GST added later. In Australia, prices shown to consumers must be GST-inclusive, while business-to-business pricing is often quoted exclusive because the buyer claims the tax back.
This is the figure a consumer must be shown. To work backwards from an inclusive price, divide it by one point one.
How it varies across Australia
The pricing display you choose quietly shapes who you attract. Consumer brands that quote inclusive look honest and convert cleanly. Businesses that quote exclusive to consumers look cheaper until checkout, where the added tax reads as a nasty surprise and abandonment climbs.
See how conversion and pricing play out across Australian industries →What it actually means
GST-inclusive and GST-exclusive are two ways to show the same price. Inclusive means the ten per cent tax is already baked into the number, so what you see is what you pay. Exclusive means the number is the pre-tax price and GST gets added on top later.
The maths is simple. To go from exclusive to inclusive you multiply by one point one. To go the other way you divide by one point one. A product priced at one hundred dollars exclusive is one hundred and ten dollars inclusive.
Which one you show is not a free choice. Australian Consumer Law requires that any price shown to a consumer is the total, GST-inclusive price. You cannot advertise the exclusive figure to consumers and reveal the tax at the checkout.
Business-to-business is different. Businesses quote exclusive prices all the time because the buyer is registered for GST and claims the tax back, so the exclusive number is the one that matters to them. The trap is mixing the two. A consumer-facing brand that quotes exclusive prices looks cheaper in the ad and then loses people at checkout when the real total appears.
Inclusive or exclusive is not a finance choice. It decides whether your price feels honest or feels like a trap at checkout.
How to calculate it
Inclusive price = exclusive price × 1.1. Exclusive price = inclusive price ÷ 1.1
Worked example. A service quoted at two hundred dollars exclusive becomes 200 × 1.1 = 220 dollars inclusive for a consumer. If a consumer is shown 220 dollars and a business buyer is shown 200 dollars, both are seeing the price that is correct for them.
The Australian context
The rule that prices shown to consumers must be GST-inclusive comes from Australian Consumer Law, and it is stricter than the United States norm where tax is often added at the register. An imported campaign that quotes pre-tax prices to Australian consumers can breach the rules even if it converted fine overseas. When in doubt, show the all-in number to consumers and reserve exclusive pricing for business buyers who expect it.
Where people get this wrong
GST-inclusive vs exclusive pricing vs GST
| GST-inclusive vs exclusive pricing | GST | |
|---|---|---|
| What it is | A way to display the price | The tax being displayed |
| The decision | Show tax inside or outside the number | Ten per cent of the sale, no choice |
| Marketing lever | Shapes trust and checkout conversion | Shapes margin |
Related terms
Common questions
Do I have to show GST-inclusive prices in Australia?
To consumers, yes. Australian Consumer Law requires the total GST-inclusive price to be displayed. Business-to-business pricing can be quoted GST-exclusive because the buyer is registered and claims the tax back.
How do I convert an exclusive price to an inclusive one?
Multiply the exclusive price by one point one. A hundred-dollar exclusive price is one hundred and ten dollars inclusive. To reverse it, divide the inclusive price by one point one rather than taking ten per cent off.
Why does the display choice affect conversion?
The exclusive price is always the smaller number, so showing it to consumers looks cheaper until the tax appears at checkout. That late surprise reads as a trap and lifts abandonment. The honest inclusive price converts better through the funnel.
Which should I use for B2B?
Usually exclusive. Business buyers are registered for GST and reclaim it, so the pre-tax figure is the one they compare on. Quoting inclusive to a business audience can make you look more expensive than you are.
About New Rebellion
New Rebellion is a marketing intelligence consultancy. We build tools, score Australian businesses on how their marketing actually performs, and publish Debrief every day. This dictionary is part of how we work in the open.
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