Difference Between CGST, SGST and IGST

In India’s GST (Goods and Services Tax) regime, tax is categorized into CGST (Central GST), SGST (State GST), and IGST (Integrated GST). These components ensure the tax is shared between the Centre and States in a logical and transparent manner.

Let’s understand the difference between CGST, SGST and IGST with simple definitions and examples.

📌 What is CGST?

CGST stands for Central Goods and Services Tax. It is levied by the Central Government on intra-state transactions, i.e., when a sale of goods or services happens within the same state.

📌 What is SGST?

SGST stands for State Goods and Services Tax. It is levied by the State Government on the same intra-state supply. The CGST and SGST are charged simultaneously and equally.

🧮 Example of CGST + SGST:
Suppose a seller in Delhi sells goods worth ₹1,000 to a buyer in Delhi. If the GST rate is 18%, then:

• CGST = ₹90

• SGST = ₹90
  Total GST = ₹180

Both the Central and Delhi State Governments collect ₹90 each.

🌐 What is IGST?

IGST stands for Integrated Goods and Services Tax. It is levied by the Central Government on inter-state transactions, i.e., when goods or services move from one state to another.

🧮 Example of IGST:
A seller in Maharashtra sells goods worth ₹1,000 to a buyer in Tamil Nadu. If GST is 18%, then:

• IGST = ₹180
  The Central Government collects IGST and later distributes the state share to Tamil Nadu.

GST Registration – Here

🔍 Key Differences Between CGST, SGST and IGST

🎯 Conclusion

Understanding the difference between CGST, SGST and IGST helps businesses ensure correct tax filing and compliance. Always apply CGST + SGST for intra-state supplies and IGST for inter-state supplies. Proper understanding avoids errors and penalties in GST returns.