## Article 269A – Who Collects IGST and Who Gets the Money

### The Provision

> GST on inter-State supply shall be collected by the Central Government and apportioned between Centre and States in the manner provided by Parliament on the recommendation of the GST Council.

### Why Centre Collects, Not the Origin State

GST is a destination-based consumption tax. The revenue should accrue to the State where consumption happens, not where the supplier is located.

If origin States collected IGST, the consuming State would lose revenue on goods/services flowing in from outside. So:

1. Centre collects the entire IGST.

2. Centre keeps its share (CGST component).

3. Centre transfers the State share to the consuming State (SGST component).

### Inter-State Supply Treatment

Step	What Happens
Supplier collects	Full IGST from buyer
Deposit	Entire amount to Central Government
Apportionment	Centre's share retained; State's share transferred to consuming State

### Connection with Article 246A

Article 246A grants exclusive power to Parliament to legislate on inter-State GST. That's why IGST Act is a Central Act even though revenue is shared.

Worked example

### Example 1

Example – Apportionment of IGST

A Delhi supplier sells goods worth ₹10,00,000 to a buyer in Tamil Nadu. IGST @ 18% = ₹1,80,000.

Supplier collects ₹1,80,000 IGST from Tamil Nadu buyer.
Entire ₹1,80,000 deposited with Central Government.
Apportionment: ₹90,000 retained by Centre; ₹90,000 transferred to Tamil Nadu (consuming State).

Note: Delhi (origin State) gets nothing — consistent with destination-based taxation.

⚠️ Common exam mistakes

Assuming IGST is apportioned to the origin State — it goes to the consuming/destination State.
Confusing apportionment under Article 269A with the general tax-sharing arrangement under Article 270.
Thinking States can levy IGST directly — only Centre is empowered under Article 246A(2) read with Article 269A.

Bare-Act text Article 269A · Constitution of India · click to expand

Article 269A(1): Goods and services tax on supplies in the course of inter-State trade or commerce shall be levied and collected by the Government of India and such tax shall be apportioned between the Union and the States in the manner as may be provided by Parliament by law on the recommendations of the Goods and Services Tax Council.

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Article 269A – Apportionment of IGST

Worked example

⚠️ Common exam mistakes