CGST vs SGST
The dual GST split on intra-state sales — Centre and State each take half the combined rate.
Start here
Central GST (CGST) is the Union’s share of GST on intra-state supplies; State GST (SGST) is the state’s equal share on the same transaction — together replacing IGST on cross-border sales.
India follows a Dual GST Model — a compromise preserving both Centre’s and States’ taxing powers while creating one unified market. For every café bill in Bengaluru, two taxes appear on the same transaction.
Article 246A and the GST Council (Art. 279A) are the constitutional backbone — voting weight (Centre 1/3, States 2/3) is a Prelims favourite.
Side-by-side comparison
| Feature | CGST | SGST |
|---|---|---|
| Full form | Central Goods and Services Tax | State Goods and Services Tax |
| Applicability | Intra-state supply (within same state) | Intra-state supply (within same state) |
| Levied & collected by | Central Government | Respective State Government |
| ITC rule | CGST credit offsets CGST/IGST only | SGST credit offsets SGST/IGST only — not cross-setoff with CGST |
| Rate example (18% supply) | 9% CGST on intra-state bill | 9% SGST on same bill — total 18% |
| GST Council role | Centre + states decide rates jointly (Art. 279A) | Same Council — states have 2/3 weighted vote |
At a glance
Jurisdiction
Federal / Central
Regional / State
Tax split
Usually 50% of total GST rate
Usually 50% of total GST rate
Inter-state supply
Replaced by IGST
Replaced by IGST
Revenue destination
Consolidated Fund of India
State Consolidated Fund
GST café bill in Bengaluru — 18% split
Your filter coffee and snack bill is ₹500 + GST. At 18%, the receipt shows ₹45 CGST + ₹45 SGST (not one ₹90 line). ₹45 goes to Union revenue; ₹45 to Karnataka. The café claims Input Tax Credit on beans and milk GST paid — but CGST credit cannot offset SGST liability directly (water-tight compartments; IGST acts as bridge). Order the same meal from Bengaluru to Chennai? Single 18% IGST replaces both.
What this means for the exam
Intra-state = CGST + SGST (50-50 split) | Inter-state = IGST | ITC compartments are separate.
Understand the difference
Fiscal federalism and the GST Council
The GST Council decides rates, exemptions, and thresholds — Centre has one-third vote, States two-thirds. Decisions need 75% majority, giving effective veto power to both tiers. Mains answers on cooperative federalism often cite GST as success and friction point (compensation cess expiry).
Prelims statement check
“CGST and SGST can be set off against each other for input tax credit.”
Incorrect — ITC compartments
Water-tight — CGST ITC cannot offset SGST liability; IGST pool bridges inter-state credit.
“GST Council decisions require a three-fourths majority of weighted votes.”
Correct — Council voting
Centre 1/3 weight, all States together 2/3 — 75% threshold for decisions.
PYQ Linkage
The GST Council is constituted under which Article of the Constitution?
Key Takeaway
Intra-state = CGST + SGST (equal split) | ITC in separate compartments | Council = cooperative federalism