Faq S On Apportionment Of Tax And Settlement Of Funds Under Igst

Q1. What is the mechanism of IGST apportionment between Centre and State? Ans. The IGST paid on supplies (local or imports) made to:

(a) An unregistered person (b) Composition dealer (c) Taxable Person who is not eligible for Apportionment of Tax and Settlement of Funds (d) Taxable Person who does not avail credit within specified period

will be apportioned to the Central Government based on the rate of CGST on similar intra -State supply and the balance will be apportioned to the State Government where such supply takes place. ‘Appropriate State’will be determined based on Sections 7 to 10 of the IGST Act which provides for Place of Supply of Goods / Services. Q2. How will the IGST portion be distributed to the extent of State share if the place of supply cannot be determined? Ans. Such State share of tax will be distributed in proportion to the supplies made by the taxable person to each of the States during the year to which such tax relates to. Q3. How will the IGST portion be distributed if distribution as mentioned under response to Q2 is not possible since the taxable person cannot be identified? Ans. Such State share of tax will then be distributed based on the order to be made by the President based on the provisions contained in the Constitution of India. Q4. How will the Penalty, Interest etc. paid on IGST be distributed? Ans. The penalty, interest etc. will be distributed the same way as the IGST is distributed. Recommended Articles

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