Types of GST in India

Types of GST in India

The Goods and Service Tax is meant to be a unified indirect tax across the country on products and services. In the current system, the tax is levied at each stage separately by the Union government and the States at varying rates, on the full value of the goods. But under the GST system, the tax will be levied only on the value added at each stage. It is a single tax (collected at multiple points) with a full set-off for taxes paid earlier in the value chain.

Types of GST

In India, there are three types of GST: CGST, SGST, IGST

Central GST – CGST State GST – SGST Integrated GST – IGST
Tax Levied By Central Government State Government Combined levy, collected by Central Government
Taxes that it will replace Service tax, excise duty, countervailing duty (CVD), special additional duty (SAD), Additional duties of excise(ADE), and any other indirect central levy VAT, sales tax, luxury tax, entry tax , entertainment tax, purchase tax, Octroi, taxes on lottery Central sales tax (CST)
Applicability Supplies within a state Supplies within a state Interstate supplies and import
Input Tax Credit Against CGST and IGST Against SGST and IGST Against CGST,SGST and IGST
Tax Revenue Sharing Central government State government Shared between state and central governments
Exemption Limit Rs. 20 Lakhs annual turnover Rs. 20 Lakhs annual turnover Exemption limit not defined
Composition Scheme The dealer may use the benefit of turnover of Rs 50 Lakh The dealer may use the benefit of turnover of Rs 50 Lakh Composition Scheme is not available in this regard
Free Supplies CGST is applicable on free supplies SGST is applicable on free supplies IGST is applicable on free supplies
Registration Not applicable till the turnover exceeds Rs 20 Lakh Not applicable till the turnover exceeds Rs 20 Lakh Registration is necessarily mandatory if supply is made outside the states

 


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