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Inter-State vs Intra-State
To understand the concepts of CGST, SGST and IGST, it is first
important to understand the concept of inter-state vs intra state supply
of goods and service, under GST. As in every taxable transaction, it is
important to distinguish between inter-state vs intra-state supply to
determine if CGST or SGST or IGST would be applicable.
Inter-State Supply
An inter-state supply of goods or service is one where the location of
supplier of goods/service and place of supply are in different states. In
addition, supply of goods or service to or by an SEZ developer or SEZ
unit, supply in the course of import of goods or service, supply when
supplier is located in India and the place of supply is located outside
India (export) and any other supply not covered under intra-state is
treated as inter-state supply.
Intra-State Supply
An intra-state supply of goods or service is when the place of supply is
in the same state as the location of the supplier. Intra-state supply
does not include supply of goods/service to SEZ units or developers,
imports or exports.
Highlights of CGST
• CGST is applicable on both, goods and services.
• CGST is levied by the Central Government through a separate
statute on all transactions of goods and services made for a
consideration.
• Proceeds would be shared between the Central and State
Government.
Meaning of IGST or
Integrated GST
Integrated GST or IGST is the tax levied under the IGST Act
(http://www.cbec.gov.in/resources//htdocs-cbec/gst/igst-
act.pdf) on the supply of any goods and/or services in the course of
inter-state trade across India. Further, IGST would include any supply
of goods and/or services in the course of import into India and export
of goods and/or services from India. IGST will replace the present
Central State Tax which is levied on the inter-state sales of goods.
Thus, IGST would be applicable for all inter-state transactions, import
and export of goods and/or services.
Highlights of IGST
• Central Government would levy and collect IGST instead of CGST
or SGST.
• Levied on inter-state supply of goods and/or services.
• Includes import of goods and/or services.
• Exports would be zero rated.
• IGST would be shared between the Central and State Government.
Summary
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