Search Suggestions
- Gold Loan
- Money Transfer
- Mutual Funds

CGST vs SGST: Key Differences Every Business Should Know
Goods and Service Tax also known as GST is a tax which applies to the supply of goods and services. It was first suggested by the Kelkar Task Force in 2002 and was later announced in the Union Budget of 2006-07. Eventually, the implementation of GST was later finalized with the parliament passing the Constitutional Amendment Act in September 2016. This was later followed by the State Legislatures and GST was rolled out with effect from 1 July 2017. GST registration is mandatory for a business to run & operate smoothly.
Table of Content
- Components Of GST
- Definition Of SGST And CGST
- Benefits Of GST
- Key Differences Between CGST And IGST
- Features Of CGST And SGST
A business loan at Muthoot Finance is designed to provide the perfect solution for all types of businesses. Retailers, traders, dealers, distributors, wholesalers & service providers must be aware of the types of GST, their differences and their significance to avoid being exploited.
Components Of GST
Before the introduction of GST, there were multiple taxes such as Central Excise, Service Tax, State VAT, etc., however, with the introduction of GST all four components are embedded. These are:
- CGST: Central Goods and Services Tax
- SGST: State Goods and Services Tax
- UTGST: Union Territory Goods and Services Tax
- IGST: Integrated Goods and Services Tax
Definition Of SGST And CGST
Those involved in a business must grasp the notion of what is CGST and how it affects the business. Taxes that are levied on any transaction of goods and services within the state are known as Central Goods and Service Taxes. It is a type of tax that is charged on every intrastate transaction.
With the intervention of CGST, all other forms of central taxes such as the service tax, central excise duty and customs duty have been eliminated. Whereas, SGST is a type of tax levied on intrastate supplies of goods and services by the state government. To help you better understand what is SGST, let’s say you want to sell goods to someone who is from the same state as you. Then you have to pay a GST comprising of both CGST and SGST. In the case of SGST, it eliminates state taxes such as VAT, entertainment tax, sales tax, luxury tax, entry tax, state cess etc.
Suggested Read :10 Tax Saving Tips For Business Owners In India
Benefits Of GST
- GST aims to lower the cost of goods and services.
- Boost & promote the economy.
- Making Indian products and services globally competitive.
- Uniformity in the tax structure.
- Subsuming Central and State indirect taxes into a single tax.
Key Differences Between CGST And IGST
Difference | CGST | SGST |
Meaning | This has eliminated central taxes such as service tax, excise tax etc. | This has eliminated state taxes such as sales tax, luxury tax etc. |
Imposed by or Benefiting Authority | Central Government | State Government |
Applies in | Intrastate | Intrastate |
Determining Factor | The location of the supplier and buyer is from the same state. | The location of the supplier and buyer is from the same state. |
Rate of Tax | Does not exceed 14%. | Does not exceed 14%. |
Features Of CGST And SGST
Dual Tax Structure – Both CGST and SGST operate as dual taxes. It is levied simultaneously on intra-state transactions. Ensuring both the central and state governments collect revenue from the same transaction. This eventually contributes to the overall tax pool on behalf of the respective jurisdictions.
Different Accounting – Accounting for both CGST and SGST is done separately. This is to ensure clarity and transparency in tax utilization and collection. This separation also facilitates accurate tracking of each tax component.
Revenue Sharing – The revenue collected from CGST is monitored and utilized by the Central Government, which they can use for national initiatives and programs. Whereas revenue from SGST is allocated by respective state governments, this allows them to address regional development and other issues.
The implementation of GST is probably one of the biggest tax reforms the world has ever seen. The GST system follows a dual structure that comprises both CGST and SGST. It has ushered uniformity in tax rates as well as formats of registration forms. The advent of GST also aims to maintain transparency while making informed decisions across the country.
CATEGORIES
OUR SERVICES
-
Credit Score
-
Gold Loan
-
Personal Loan
-
Cibil Score
-
Vehicle Loan
-
Small Business Loan
-
Money Transfer
-
Insurance
-
Mutual Funds
-
SME Loan
-
Corporate Loan
-
NCD
-
PAN Card
-
NPS
-
Custom Offers
-
Digital & Cashless
-
Milligram Rewards
-
Bank Mapping
-
Housing Finance
-
#Big Business Loan
-
#Gold Loan Mela
-
#Kholiye Khushiyon Ki Tijori
-
#Gold Loan At Home
-
#Sunherisoch
RECENT POSTS

What Is a Grace Period in Health Insurance? Meaning & How It Works
Know More
Life Insurance Vs Health Insurance: What’s the Real Difference?
Know More
Urgent Loans for CIBIL Defaulters in 2025: What You Need to Know
Know More
Loan Restructuring: Meaning, Process, and Its Impact on Gold and Personal Loans
Know More
1 Pavan Gold in Grams: Meaning and How It Is Calculated
Know More
NACH vs. ECS Explained: Full Forms, How They Work, and Their Key Differences
Know More
MCLR Rate vs. Repo Rate Explained: Which Is Better for a Home Loan?
Know More
Effective Annual Rate (EAR) vs. Nominal Rate: Meaning and Key Differences
Know More
Calculate Compound Interest in Seconds (2025)
Know More
Annualized Return Formula Every Investor Needs To Know
Know MoreFIN SHORTS

Top 5 Reasons to Monitor Gold Rate Daily
Know More
4 Impact of Repo Rate Cut on Personal Loan Interest Rates
Know More
Top 5 Best Performing Mutual Funds in 2025
Know More
5 Factors that affect gold loan processing time
Know More
Relation Between Personal Loan and Your CIBIL Score
Know More
Step-by-Step Way to Get Your First CIBIL Score
Know More
What Does A Revolving Personal Loan Mean?
Know More
When does CIBIL Score Be an Update Date Every Month?
Know More
Which Industries Qualify For SME Loan Schemes
Know More
Do Gold Loan Offer Any Tax Exemption?
Know More
After Paying All Debts How Long Does Cibil Take To Update The Score?
Know More
What Is The Reappraisal of A Gold Loan?
Know More- South +91 99469 01212
- North 1800 313 1212