IGST Full Form | Full Form of IGST
IGST Full Form - Integrated Goods and Services Tax
Integrated Goods and Services Tax
- IGST stands for Integrated Goods and Services Tax.
- It's a category of GST that refers to taxes levied on interstate transactions or supplies of goods and services which are taxable as well as on imports of goods and services.
- IGST is collected by the Central Government and is further distributed among the respective states.
- IGST is charged when a product or service moves from one state to a different state.
- The tax is shared between the central and state governments.
- The state deals with the Central Government and not with other states to settle the interstate tax amounts.
Features of IGST Tax
- It is applicable to inter-state supply of goods and services.
- It ensures that the consuming state gets the SGST component of the IGST Tax.
- It maintains the integrity of Input Tax Credit chain in inter-state supplies.
- It abolished the earlier Central sales tax (CST) Act, 1956.
The GST act governs IGST levies. According to the IGST Act, the Centre would levy IGST which might be CGST plus SGST on all inter-state transactions of taxable goods and services.
The tax are going to be collected by the Central Government, and therefore the tax are going to be apportioned between the union and the states within the manner as could also be provided by Parliament by law on the recommendations of the goods and Services Tax Council.
- Ram is a trader in Delhi. He sold goods worth Rs. 5000 to Mohan in Rajasthan. It’s an interstate transaction, so IGST is applicable here.
- Suppose the GST rate for the goods is 15%. So, the IGST charged by the Central Government are going to be Rs. 750 (15% of Rs. 5000) and therefore the new price of the product would be Rs. 5750.
- The IGST is paid to the central government and is shared between the government and central government because the tax rates decided by the authorities.
- Integrated GST is additionally applicable to import of goods and services into India.
- The essential concept is that any transport of goods or services during the import of goods or services into the territory of India shall be deemed to be a supply involving inter-state trade or commerce and hence susceptible to IGST.