GST · 26 June 2026
Inter-State vs Intra-State Supply: CGST+SGST or IGST?
Whether a supply is inter-state or intra-state decides which tax appears on the invoice: an intra-state supply carries CGST plus SGST, while an inter-state supply carries IGST. The classification is set by Sections 7 and 8 of the IGST Act, which compare two coordinates, the location of the supplier and the place of supply. Same state for both means intra-state (CGST+SGST); different states or union territories means inter-state (IGST). A few supplies are inter-state by law even within one state, most notably supplies to a Special Economic Zone, imports, and exports under Section 7(5). Charging the wrong type is fixable: Section 77 of the CGST Act and Section 19 of the IGST Act let you reclaim tax paid under the wrong head, without interest, once you pay the correct one.
By Mrs. Swapna Patel
Last reviewed
26 June 2026
In this section
Answers
- Inter-State vs Intra-State Supply: CGST+SGST or IGST?
- What Is GSTR-1, the GST Return of Outward Supplies?
- What Is GSTR-3B, the Monthly GST Summary Return?
- What Is the Time of Supply Under GST, and When Does Tax Become Due?
- Advance Receipt Under GST: When Do You Issue a Receipt Voucher?
- Credit Note vs Debit Note Under GST: When Do You Issue Each?
- What Is GSTR-2B, and Why Does It Now Decide Your Input Tax Credit?
- What Is the Value of Supply Under Section 15 of the CGST Act?
- What Are the GST Rate Slabs in India After the GST 2.0 Reform?
- Exempt vs Nil-Rated vs Zero-Rated Supply: What Is the Difference?
A supply is inter-state only when the buyer is in another state, and intra-state when the buyer is in your state.
Under Sections 7 and 8 of the IGST Act it is decided by comparing the supplier's location with the place of supply, and a supply inside one state can still be inter-state, for example a supply to an SEZ unit.
What makes a supply inter-state or intra-state?
Short answer
Two coordinates under Sections 7 and 8 of the IGST Act: the supplier's location and the place of supply. Same state for both is intra-state; different states or union territories is inter-state.
The buyer's billing address alone does not decide it. You compare where the supplier is located against the place of supply, which for goods is usually the delivery point and for services is usually the recipient's location. For how the place of supply itself is fixed, see place of supply in GST.
- Section 8 (intra-state): supplier and place of supply in the same state or UT.
- Section 7 (inter-state): supplier and place of supply in different states or UTs.
- Why it matters: the test is location-versus-place-of-supply, not simply where the customer lives.
How does the classification change which GST you charge?
Short answer
An intra-state supply carries CGST plus SGST in two equal halves; an inter-state supply carries a single IGST at the combined rate. The total tax is the same, only the split and the destination differ.
| Supply type | Tax charged | Example at an 18% rate |
|---|---|---|
| Intra-state (Section 8) | CGST + SGST | 9% CGST + 9% SGST |
| Inter-state (Section 7) | IGST | 18% IGST |
The split under Sections 7 and 8, IGST Act. The 18% figure is one common services rate used for illustration; apply the rate notified for your specific supply, as CBIC slabs change. For the three components, see CGST, SGST and IGST explained.
When is a supply inter-state even within the same state?
Short answer
A handful of supplies are inter-state by law regardless of geography under Section 7(5) of the IGST Act, most importantly a supply to or by a Special Economic Zone unit, plus imports and exports.
- SEZ supplies: selling to an SEZ unit in your own city is still an inter-state supply, so it attracts IGST (or moves under zero-rating).
- Imports of goods or services are treated as inter-state supplies.
- Exports are inter-state and zero-rated; see export of services under GST.
- Why it matters: these carve-outs catch sellers who assume a local delivery address always means CGST+SGST.
Can you fix a CGST/SGST vs IGST mix-up?
Short answer
Yes. Section 77 of the CGST Act and Section 19 of the IGST Act let you reclaim tax paid under the wrong head, without interest, once you pay the tax under the correct head.
- If you charged IGST on what was an intra-state supply (or the reverse), you are not penalised for the classification error itself.
- You pay the correct tax, then claim a refund of the tax wrongly paid under the other head, and no interest is charged on the corrected amount.
- Why it matters: the remedy removes the fear of a double cash hit, but you still have to spot the error and act, so getting the classification right on the tax invoice first is cheaper than unwinding it.
References & related
Primary sources
- Section 7, Integrated Goods and Services Tax Act 2017 (inter-state supply) — India CodeSupplier and place of supply in different states; also imports, exports, and SEZ supplies.
- Section 8, IGST Act 2017 (intra-state supply) — India CodeSupplier and place of supply in the same state or union territory.
- Section 77, CGST Act 2017 and Section 19, IGST Act 2017 (wrong tax paid) — India CodeRefund of tax paid under the wrong head, without interest, on paying the correct tax.
Last reviewed: 26 June 2026