Types OF GST – CGST, SGST, IGST, AND UTGST

Types of GST

There are Four GST types

  • Integrated Goods and Services Tax (IGST)
  • State Goods and Services Tax (SGST)
  • Central Goods and Services Tax (CGST)
  • Union Territory Goods and Services Tax (UTGST).

GST TABLE

Types of GSTAuthoritiesCollected ByTransaction
CGSTCentral GovernmentCentral GovernmentIntrastate – within a single state
SGSTState GovernmentState GovernmentIntrastate – within a single state
IGSTCentral Government and State GovernmentCentral GovernmentInterstate
UTGST/UGSTUnion Territory (UT) GovernmentUnion Territory (UT) GovernmentWithin a single Union Territory (UT)

Types of GST and its Explanation

1. Integrated Goods and Services Tax or IGST

The Integrated Goods and Services Tax or IGST is a tax under the GST regime that is applied on the interstate (between 2 states) supply of goods and/or services as well as on imports and exports.

The IGST is governed by the IGST Act. Under IGST, the body responsible for collecting the taxes is the Central Government.

After the collection of taxes, it is further divided among the respective states by the Central Government. For example, if a trader from Delhi has sold goods to a customer in Haryana worth Rs.10,000, then IGST will be applicable as the transaction is an interstate transaction.

If the rate of GST charged on the goods is 18%, the trader will charge Rs.10000 + 1800, which is 11800 for the goods.

The IGST collected is Rs.1800, which will be going to the Central Government.

2. State Goods and Services Tax or SGST

The State Goods and Services Tax or SGST is a tax under the GST regime that is applicable on intrastate (within the same state) transactions.

SGST is always levied along CGST on the intrastate supply of goods and services.

However, the State GST or SGST is levied by the state on the goods and/or services that are purchased or sold within the state. It is governed by the SGST Act.

The revenue earned through SGST is solely claimed by the respective state government. For example, if a trader from Delhi has sold goods to a customer in Haryana worth Rs.10,000, then the GST applicable on the transaction will be divide in two part SGST and CGST.

If the rate of GST charged is 18%, it will be divided equally in the form of 9% CGST and 9% SGST. The total amount to be charged by the trader, in this case, will be Rs.11,800.

Out of the revenue earned from GST under the head of SGST, i.e. Rs.900, will go to the Delhi government in the form of SGST and rest to the Central Government.

3. Central Goods and Services Tax or CGST

Just like State GST, the Central Goods and Services Tax of CGST is a tax under the GST regime that is applicable on intrastate (within the same state) transactions.

The CGST is governed by the CGST Act. The revenue earned from CGST is collected by the Central Government.

As mentioned in above example, if a trader from Delhi has sold goods to a customer in West Bengal worth Rs.10,000, then the GST applicable on the transaction will be partly CGST and partly SGST.

If the rate of GST charged is 18%, it will be divided equally in the form of 9% CGST and 9% SGST.

The total amount to be charged by the trader, in this case, will be Rs.118,00.

Out of the revenue earned from GST under the head of CGST, i.e. Rs.450, will go to the Central Government in the form of CGST.

4. Union Territory Goods and Services Tax or UTGST

The Union Territory Goods and Services Tax or UTGST is the counterpart of State Goods and Services Tax (SGST) which is levied on the supply of goods and/or services in the Union Territories (UTs) of India.

The UTGST is applicable on the supply of goods and/or services in – Andaman and Nicobar Islands, Chandigarh, Daman Diu, Dadra, and Nagar Haveli, and Lakshadweep, where there is no legislation.

The UTGST is governed by the UTGST Act.

The revenue earned from UTGST is collected by the Union Territory government.

The UTGST is basically SGST but for Union Territories. Thus, the UTGST will be levied in addition to the CGST in Union Territories like SGST in states.

ALSO READ – How GST Works Between SGST CSGT IGTS | Interstate , Intrastate

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