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Microlesson · 5-min read

Dual GST Model

# Dual GST Model

## What is Dual GST?

In the Dual GST model, both the Centre and the State levy GST simultaneously across the supply chain.

## Key Features

1. Both Centre and State have concurrent powers to levy GST.

2. The Centre is empowered to tax intra-state sales of goods.

3. The States can tax services.

4. GST applies to the whole of India, including Jammu & Kashmir.

5. GST is a destination-based tax — tax revenue goes to the State where the goods/services are consumed.

## Types of Supplies & Taxes Levied

### Intra-State Supply

Definition: Location of supplier AND place of supply are in the same State / UT.

Following taxes are levied:

TaxLevied & Collected By
CGSTCentral Government
SGSTState Government / UT with Legislature
UTGSTUT without Legislature

### Inter-State Supply

Definition: Location of supplier and place of supply are in:

  • Two different States, OR
  • Two different UTs, OR
  • A State and a UT

Tax levied: IGST = (CGST + SGST/UTGST equivalent)

IGST is levied and collected by the Central Government and apportioned between Centre and the consuming State.

## Visual Mapping

```

Intra-State Supply (Same State/UT)

-----------------------------------

CGST + SGST (if State / UT with Legislature)

CGST + UTGST (if UT without Legislature)

Inter-State Supply (Different States/UTs)

------------------------------------------

IGST (combines Centre + Destination State share)

```

## UTs with Legislature (for SGST purpose)

  • Delhi
  • Puducherry
  • Jammu & Kashmir

Worked example

### Example 1

Example 1 (Intra-State): A supplier in Maharashtra sells goods to a buyer in Maharashtra worth ₹1,00,000. GST rate is 18%. → CGST @9% (₹9,000) + SGST @9% (₹9,000) is charged. Total tax = ₹18,000.

### Example 2

Example 2 (Inter-State): A supplier in Karnataka sells goods to a buyer in Tamil Nadu worth ₹1,00,000. GST rate is 18%. → IGST @18% (₹18,000) is charged.

### Example 3

Example 3 (UT without Legislature): Supply within Chandigarh (UT without legislature) attracts CGST + UTGST.

⚠️ Common exam mistakes

  • Charging CGST + SGST on an inter-state supply — only IGST should be charged.
  • Treating Delhi/Puducherry/J&K as UTs without legislature — they HAVE legislatures, so SGST (not UTGST) applies.
  • Forgetting that GST is destination-based, not origin-based.
Reference:
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