Assets Taxable Under Wealth Tax in India

 GST Types

In India, Goods and Services Tax (GST) is divided into four main types, depending on the nature of transactions and the regions involved. Each type serves a specific role in ensuring that tax is properly allocated to the appropriate governing body, whether it’s central or state-level administration.

1. Central GST (CGST)

• Description: This is the GST collected by the Central Government on transactions happening within a single state, known as intra-state transactions.
• Example: If a product is sold within Karnataka, both CGST and SGST are applied to the invoice. The CGST portion goes to the central government.
• Rate Distribution: If the total GST on an item is 18%, 9% would be allocated to CGST and 9% to SGST.

2. State GST (SGST)

• Description: Collected by the State Government on intra-state transactions, SGST complements CGST and helps provide revenue for state-level projects and services.
• Example: In an intra-state transaction in Karnataka, while the central government collects CGST, the Karnataka state government collects SGST.
• Revenue Allocation: The revenue generated from SGST goes entirely to the state where the transaction occurs.

3. Integrated GST (IGST)

• Description: IGST applies to inter-state transactions (transactions between two different states) and on imports. It is collected by the Central Government and later distributed among the states involved.
• Example: If a business in Maharashtra sells goods to a business in Tamil Nadu, IGST applies to the invoice, and the revenue is later shared with the relevant states.
• Function: IGST simplifies taxation for inter-state transactions by avoiding the need for multiple registrations in different states and allows for seamless input tax credits across state lines.

4. Union Territory GST (UTGST)

• Description: This type of GST applies to transactions within Union Territories (UTs) without a legislature, such as Lakshadweep, Andaman and Nicobar Islands, Dadra and Nagar Haveli, Daman and Diu, and Chandigarh.
• Example: For a sale made within a Union Territory, both CGST and UTGST apply to the invoice.
• Purpose: Similar to SGST, UTGST is designed to ensure that Union Territories receive their share of tax revenue.

 

Summary of Application

Transaction Type	GST Type	Tax Collected By
Intra-state (within a state)	CGST + SGST	Central + State Governments
Inter-state (between states)	IGST	Central Government (to be shared with states)
Within Union Territory	CGST + UTGST	Central + Union Territory Administrations

Each type ensures that both state and central governments receive their due share from the tax collected, supporting various governmental activities and infrastructure projects at both levels.