What is IGST?
IGST is abbreviated as Integrated Goods and Services and it comes under GST (Goods and Services). The tax revenue of IGST is shared between State government and Central government as per the rate fixed by the authorities. IGST is applied only when the movement of goods and services are transacted from one state to another. It falls under Integrated Goods and Service Tax Act 2016. Follow the example given below to know how the taxes would be collected by the Central government.
Consider a product of worth Rs. 1, 00,000 is sold by manufacturer A in Maharashtra to Dealer B in Gujarat. The GST rate of 18% is comprised with both CGST rate of 9% and SGST rate of 9%. , However the dealer collects Rs. 18,000 as IGST will go to the Central government.