GST Basics: CGST, SGST and IGST Explained

GST, or Goods and Services Tax, replaced a patchwork of older indirect taxes in India with a single tax system. While the headline rate — 5%, 12%, 18% or 28% depending on the item — is what most people notice on a bill, that total is actually split between different components depending on where the transaction takes place.

CGST and SGST — for transactions within a state

When a sale happens within the same state — both the buyer and seller are located there — the GST is split equally between the Central Government and the State Government. CGST (Central GST) and SGST (State GST) each take half of the total GST rate. So for an 18% GST item, you'd see 9% CGST and 9% SGST on the invoice, adding up to the same 18% total.

IGST — for transactions between states

When goods or services move between two different states, a single tax called IGST (Integrated GST) applies instead, at the full rate. The revenue is then settled between the central and state governments. From a buyer's perspective, the total tax amount works out the same either way — it's the split behind the scenes that differs.

Why this matters for everyday calculations

For most everyday purposes — checking a bill, working out a price, or budgeting — what matters is the total GST amount and the final price. The CGST/SGST split mainly matters for businesses filing returns and claiming input tax credit, but seeing it on an invoice helps make sense of how the tax system is structured.

Using the calculator

Our GST calculator lets you add GST to a base amount or remove it from a final price, across the common GST slabs, and shows the CGST/SGST split automatically.