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What is CGST, SGST & IGST and Input tax credit in GST

CGST stands for Central GST and SGST stands for State GST and IGST stands for Integrated GST.

Government recently notified standard GST rate of 18% which would be levied on goods & services which are taxable, let us understand what does it got to do with CGST & SGST.

If some one will issue an invoice of any service or goods then if the sale is Intra-state (i.e. within same state) then he will charge GST of 18% which will comprise of CGST & SGST both of 9% that means 9% belongs to state government and 9% belongs to central government.

Further if sale made is Inter state (i.e. state other than from where supply is made) GST charged at 18% in invoice will be IGST.

Note: Rate of 18% may vary as per notification of central government in this regard.

 

Now how can credit be utilized in each case:-

Below mention table sums up the utilization rule as per Model GST law-

 

Input tax Paid Dischargeable Tax
  1. CGST
CGST & IGST
  1. SGST
SGST & IGST
  1. IGST
CGST, SGST & IGST

 

 

Articled Clerk Tarun

CA-Final

RPL & Co.

Category: M/S R P L & CO

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