If we categorise the system of GST followed in different country we will find two types of GST i.e

• ‘Single GST’ where tax is levied by the Centre and shared with the States or vice versa and
• ‘Dual GST’ where tax is levied by both the Centre and the States.

Dual Structure in India, Considering its Federal Structure:

Considering the federal structure of our country where the taxing powers have been shared by the Centre and the Sates, the GST proposed to be introduced in India is a ‘Dual GST’.

‘Dual GST’, as the word signified there will be ‘two types of GST’ in the Country.

• One GST will be levied by the Centre which is to be known as ‘Central GST’ or ‘CGST’.
• The other GST will be levied by the State and it will be known as ‘State GST’ or ‘SGST’.

Thus, on a single transaction of supply of goods or of services within a state both CGST and SGST will be levied.

IGST- A New way of taxing the Inter-State Supply

CGST and SGST will be levied on supply within the State. But what will happen in case of a supply from one state to another i.e. inter-state supply?

Such inter-state transaction will be subjected to a new levy which will be known as ‘Integrated GST’ or ‘IGST’ (would be CGST plus SGST). IGST is also levied on imports into India.

The exclusive power to levy IGST is on the Centre.