Key takeaways
- Within a state: CGST plus SGST (or UTGST), the rate split equally. Across states: IGST at the full rate.
- Which one applies is decided by the place of supply, compared with the supplier’s state.
- An over-the-counter sale is supplied where your shop is; goods sent to a buyer are supplied where delivery ends.
- The first two digits of a GSTIN are the state code.
Three taxes, one rate
GST is collected as CGST (central) and SGST (state) — or UTGST in a union territory without a legislature — when the supplier and the place of supply are in the same state. When they are in different states, it is collected as IGST (integrated).
The total rate does not change. An 18% item is charged 9% CGST plus 9% SGST on a sale within the state, or 18% IGST on a sale to another state.
What decides it: the place of supply
The place of supply is where the law treats the sale as happening. For most everyday sales it works like this:
- Goods sold over the counter: your shop’s location.
- Goods delivered to the buyer: where the delivery ends.
- Restaurant and catering services: where the service is performed.
- Most services to a registered business: the buyer’s location.
If the place of supply is in your state, charge CGST and SGST. If it is in another state, charge IGST.
Reading the state from a GSTIN
Every GSTIN starts with a two-digit state code, so a business buyer’s GSTIN tells you their state at a glance.
| Code | State | Code | State |
|---|---|---|---|
| 07 | Delhi | 27 | Maharashtra |
| 09 | Uttar Pradesh | 29 | Karnataka |
| 19 | West Bengal | 32 | Kerala |
| 24 | Gujarat | 33 | Tamil Nadu |
Worked examples
- A Pune pharmacy sells to a walk-in customer: place of supply Maharashtra, same as the pharmacy — CGST + SGST.
- A Bengaluru electronics dealer ships to a business in Chennai: place of supply Tamil Nadu — IGST.
- A Kochi café serves a tourist from Delhi: the service is performed in Kerala — CGST + SGST.
How Suiteloom decides
Each outlet bills from its own state. Counter sales are charged CGST and SGST; when you add a business buyer’s GSTIN, Suiteloom reads their state from it and charges IGST if it differs from the outlet’s. Nobody has to choose the tax type by hand.
This guide is general information, checked on 23 October 2026. It is not legal or tax advice. Rules, rates and limits are notified by the government and change; check the GST portal and official notifications, or ask your accountant, for your business.