Last reviewed: October 2026, in line with GST 2.0 rates effective 22 September 2025 and the tobacco changes effective 1 February 2026.
🗣️ Saral bhasha mein samjhein
- GST ke 4 roop hain: CGST + SGST (State ke andar bikri par) aur IGST (ek State se doosre State mein bikri par). Bina vidhan sabha wale UT mein SGST ki jagah UTGST lagta hai.
- Ab mukhya GST rate 5%, 18% aur 40% hain (22.09.2025 se).
- GST registration tab zaroori hai jab saal ka turnover maal ke liye ₹40 lakh ya service ke liye ₹20 lakh se zyada ho. Kuch logon ke liye, jaise doosre State mein maal bechne wale, ye har haal mein zaroori hai.
- ₹1.5 crore tak turnover wale chhote business Composition Scheme le sakte hain, jisme kam rate par tax dena hota hai.
- Registration cancel ho gaya ho toh 90 din mein revocation ke liye apply karein. Same GSTIN wapas milta hai.
📲 Sawal hai? WhatsApp karein: 8051331315
Types of GST: CGST, SGST, IGST and UTGST
GST (Goods and Services Tax) in India is levied in four forms, depending on whether a supply is within one State/UT or between States.
1. Central GST (CGST)
Levied by the Central Government on intra-State supplies (supplier and place of supply in the same State). Example: A Delhi trader sells goods worth ₹1,000 to a Delhi customer at 18% GST: CGST 9% = ₹90.
2. State GST (SGST)
Levied by the State Government on the same intra-State supply, alongside CGST. In the example above, SGST 9% = ₹90. Total tax = ₹180.
3. Integrated GST (IGST)
Levied by the Central Government on inter-State supplies and on imports. Example: A Delhi trader sells goods worth ₹1,000 to a customer in Maharashtra at 18%: IGST = ₹180. The Centre later settles the State share with the destination State.
4. Union Territory GST (UTGST)
Levied in Union Territories without a legislature (e.g. Chandigarh, Ladakh, Lakshadweep, Andaman & Nicobar, Dadra & Nagar Haveli and Daman & Diu) in place of SGST, along with CGST. Delhi, Puducherry and Jammu & Kashmir levy SGST.
Why Was GST Introduced?
GST came into force on 1 July 2017. It replaced a large number of Central and State indirect taxes (central excise, service tax, VAT, CST, entry tax, octroi, luxury and entertainment taxes, etc.) with one destination-based tax. Its main objectives were:
- Removing the cascading effect (tax on tax) through seamless Input Tax Credit (ITC).
- A common national market with uniform law and rates across States.
- Simpler compliance through online registration, returns and payments on the GST portal.
- Better transparency and a wider tax base through invoice matching and e-invoicing.
Most Popular GST Questions with Answers
Q1. What is GST?
GST is a comprehensive, destination-based indirect tax on the supply of goods and services, introduced on 1 July 2017. Petroleum crude, petrol, diesel, ATF and natural gas are currently outside GST, and alcoholic liquor for human consumption is outside GST altogether.
Q2. What are the current GST rate slabs?
From 22 September 2025 (GST 2.0, 56th GST Council), the main slabs are 5% (merit rate) and 18% (standard rate), with a 40% special rate for luxury and sin goods. The earlier 12% and 28% slabs were largely abolished. Many essentials are Nil-rated. Special rates continue: 3% on gold, silver and jewellery, and 0.25% on rough/cut diamonds. Tobacco products and pan masala moved to 40% GST from 1 February 2026.
Q3. What is GSTIN and what is its structure?
GSTIN is the 15-character GST Identification Number given to every registered person:
- Characters 1–2: State code (e.g. 07 for Delhi)
- Characters 3–12: PAN of the taxpayer
- Character 13: Entity number for the same PAN in that State
- Character 14: “Z” by default
- Character 15: Check code
Q4. What is Input Tax Credit (ITC)?
ITC is the credit of GST paid on purchases (inputs, input services and capital goods) used in the course of business, which can be set off against output GST. Conditions under Section 16 apply: a valid tax invoice, receipt of goods/services, the supplier’s details appearing in your GSTR-2B, tax actually paid by the supplier, and filing of your return. Credit on items listed in Section 17(5) (e.g. most motor vehicles, food and beverages, personal consumption) is blocked.
Q5. What is the difference between zero-rated and exempt supplies?
Zero-rated supplies (exports and supplies to SEZ units/developers) carry no tax burden, and the supplier can claim a refund of ITC or of IGST paid. Exempt supplies carry no GST, but the supplier cannot claim ITC on inputs used for them.
Q6. What is “place of supply”?
Place of supply decides whether a transaction is intra-State (CGST + SGST/UTGST) or inter-State (IGST). For goods, it is generally where the movement of goods ends. For services, it is generally the location of the registered recipient (B2B) and depends on the type of service for B2C supplies, under the IGST Act, 2017.
Q7. What is the Reverse Charge Mechanism (RCM)?
Under RCM, the recipient pays GST instead of the supplier, only for notified goods/services and situations. Common examples: legal services by an advocate to a business entity, GTA services (where the GTA has not opted for forward charge), sponsorship services, renting of a residential dwelling to a registered person, import of services, and supplies by unregistered persons to promoters of real estate projects.
Q8. Who must register under GST?
Registration is required if aggregate turnover in a financial year exceeds:
- ₹40 lakh for exclusive suppliers of goods (₹20 lakh in specified special category States)
- ₹20 lakh for suppliers of services (₹10 lakh in specified special category States)
Certain persons must register irrespective of turnover under Section 24, including inter-State suppliers of goods, casual and non-resident taxable persons, persons liable under RCM, e-commerce operators, persons required to deduct TDS/collect TCS, and Input Service Distributors.
Q9. What is the Composition Scheme?
An optional scheme for small taxpayers with turnover up to ₹1.5 crore (₹75 lakh in specified special category States). Tax is paid at a fixed rate on turnover: 1% for manufacturers and traders, and 5% for restaurants. Service providers with turnover up to ₹50 lakh can opt at 6%. Composition dealers cannot collect tax from customers, cannot claim ITC and cannot make inter-State outward supplies. They pay tax quarterly through CMP-08 and file the annual return GSTR-4.
Q10. What is the GST Council?
A constitutional body under Article 279A, chaired by the Union Finance Minister, with the Union Minister of State (Finance) and the Finance/Taxation Ministers of all States and UTs with legislature as members. It recommends GST rates, exemptions, thresholds, and law and procedure changes.
Q11. How are exports treated under GST?
Exports are zero-rated. An exporter can either export under a Letter of Undertaking (LUT) without paying IGST and claim a refund of unutilised ITC, or pay IGST and claim a refund of the IGST paid.
Q12. Is GST charged on imports?
Yes. Imported goods attract IGST at the time of customs clearance, in addition to basic customs duty. Imported services attract IGST under reverse charge, payable by the recipient in India. IGST paid on imports is available as ITC, subject to conditions.
Q13. What are HSN and SAC codes?
HSN (Harmonised System of Nomenclature) codes classify goods, and SAC (Services Accounting Codes) classify services. On tax invoices, taxpayers with turnover up to ₹5 crore must show at least a 4-digit HSN/SAC for B2B supplies, and taxpayers above ₹5 crore must show a 6-digit code. See our HSN & SAC code rate list.
Q14. What is an e-Way Bill?
An electronic document generated on the e-Way Bill portal for the movement of goods where the consignment value exceeds ₹50,000 (inter-State). For intra-State movement, the limit is notified by each State. It became mandatory for inter-State movement from 1 April 2018. Certain goods and situations are exempt under Rule 138.
Q15. Is a GST audit by a Chartered Accountant still required?
No. The mandatory CA/CMA-certified audit under Section 35(5) was removed with effect from 1 August 2021. Now, taxpayers with aggregate turnover above ₹5 crore file a self-certified reconciliation statement in GSTR-9C along with the annual return GSTR-9. Departmental audit under Section 65 and special audit under Section 66 can still take place.
Q16. What was the GST Compensation Cess, and does it still apply?
Compensation Cess was levied on luxury and sin goods (cars, aerated drinks, tobacco, coal, etc.) to compensate States for revenue loss. With GST 2.0, it was removed on most goods from 22 September 2025, and on tobacco and pan masala from 1 February 2026, when these moved to 40% GST along with separate Central levies. Compensation Cess no longer applies on new supplies.
Q17. What is the anti-profiteering provision?
Section 171 requires that any reduction in GST rate or benefit of ITC be passed on to the recipient through reduced prices. The Competition Commission of India (CCI) handled these cases from December 2022. Under the sunset clause recommended by the GST Council, no new anti-profiteering applications are accepted on or after 1 April 2025.
GST Registration: Questions and Answers
Q18. What is GST registration?
The process of obtaining a GSTIN on the GST portal through Form GST REG-01. A registered person can collect GST, claim ITC and make inter-State supplies. A separate registration is needed in each State/UT from where you make supplies. Businesses registering in several States can now use the Multistate Registration facility with one Master TRN.
Q19. How do I correct details in my GST registration?
Log in to the GST portal → Services → Registration → Amendment of Registration Core Fields / Non-Core Fields (Form GST REG-14). Core field changes need officer approval; non-core changes are approved automatically.
Q20. What are core and non-core fields?
Core fields: legal name of business (without change in PAN), address of principal and additional places of business (within the same State), and addition or retirement of partners/directors. Non-core fields: all other details, such as bank account, goods and services, authorised signatory, and contact details.
Q21. How do I change my email ID or mobile number?
Through a non-core amendment: update the authorised signatory’s details and verify the new email and mobile by OTP. If you have lost access to the registered email/mobile, request a change through the jurisdictional officer.
Q22. Can I change my business address?
Yes, within the same State, through a core-field amendment with proof of the new premises. A move to another State needs a fresh registration in that State.
Q23. What are the principal and additional places of business?
The principal place of business is the main place within the State where books of account are kept. Additional places of business are other premises in the same State, such as a godown, branch or shop. You can add one through a core-field amendment.
Q24. Can I register without commercial premises?
A place of business is required, but it need not be commercial. A residential address, rented premises, or a shared/co-working space can be used with valid proof (ownership document, rent agreement, electricity bill or consent letter). Physical verification may be done in certain cases.
Q25. Is a DSC mandatory for GST registration?
Yes, for companies and LLPs, whose applications must be signed with a Class 3 Digital Signature Certificate. Proprietors, partnerships and others can sign with EVC (Aadhaar OTP).
Q26. Is GST registration compulsory for e-commerce sellers?
Generally yes. However, since 1 October 2023, small sellers whose turnover is within the threshold can supply goods through e-commerce operators without registration, but only within their own State and subject to conditions (enrolment number on the portal). Service providers selling through e-commerce operators below the threshold are also exempt. E-commerce operators themselves must register.
Q27. Who is a casual taxable person, and how long is the registration valid?
A person who occasionally supplies goods or services in a State/UT where they have no fixed place of business (e.g. at an exhibition). The registration is valid for the period stated in the application, up to 90 days, extendable by a further 90 days. Advance deposit of estimated tax is required.
Q28. Who is a non-resident taxable person?
A person with no fixed place of business or residence in India who occasionally supplies goods or services in India. They must register using Form GST REG-09, appoint an authorised signatory in India, and deposit tax in advance.
Q29. What is the penalty for not registering?
Under Section 122(1)(xi), the penalty is ₹10,000 or the amount of tax evaded, whichever is higher, in addition to the tax and interest payable. The person also cannot collect GST or claim ITC.
Q30. Can GST registration be transferred?
No. A GSTIN is PAN- and State-specific. On a change of constitution with change of PAN, or on sale, merger or death of a proprietor, the transferee must obtain a new registration. Unutilised ITC can be transferred through Form GST ITC-02.
Q31. Can I change my registration type?
Yes. For example, a normal taxpayer can opt into the Composition Scheme through Form GST CMP-02 before the start of the financial year, and a composition taxpayer can opt out through Form GST CMP-04.
Q32. How do I cancel my GST registration voluntarily?
File Form GST REG-16 on the portal (Services → Registration → Application for Cancellation of Registration), giving the reason, such as closure of business or turnover below the threshold. After cancellation, the final return GSTR-10 must be filed within 3 months.
Q33. What is revocation of cancellation?
If the officer has cancelled your registration (for example, for non-filing of returns), you can apply for revocation in Form GST REG-21 within 90 days of the cancellation order, after filing all pending returns and paying dues. This period can be extended by up to 180 days by the competent authority. Revocation restores the same GSTIN.
Need help with GST registration, returns or a GST notice? Call/WhatsApp +91 8051331315 or email gstfolio@zohomail.in.
This page gives general information. Thresholds, rates and procedures change through notifications; verify on the GST portal or consult us before acting.