CGST, SGST, IGST: Definition, Meaning & Guide for Indian Businesses

CGST goes to the Central Government, SGST to the State Government, and IGST to the Central Government on inter-state transactions. The split depends on whether buyer and seller are in the same state.

What is CGST, SGST, IGST?

Under India's GST system, the tax you pay or charge is split into three components based on the location of buyer and seller. CGST (Central GST) and SGST (State GST) apply on intra-state transactions (buyer and seller in same state), split equally. So 18% GST means 9% CGST + 9% SGST. IGST (Integrated GST) applies on inter-state transactions and goes entirely to the Central Government, which later transfers the state share. So 18% GST on inter-state sale = 18% IGST. The total tax the buyer pays is the same regardless. Only the accounting and reporting differ. UTGST replaces SGST in Union Territories without legislatures.