What is Dual GST?

Dual GST is the model of Goods and Services Tax adopted by India where both the Central Government and State Governments simultaneously levy tax on the supply of goods and services. This is in contrast to countries like Singapore, Australia, and New Zealand that follow a single (national) GST model where only the central government collects the tax and shares revenue with states.

Under India's dual GST model, every intra-state transaction attracts two components of tax: Central GST (CGST) collected by the Centre and State GST (SGST) (or UTGST for Union Territories) collected by the respective state/UT. For inter-state transactions, an Integrated GST (IGST) is levied by the Centre, which is then apportioned between the Centre and the destination state. The GST Council -- a constitutional body under Article 279A (inserted by the 101st Constitutional Amendment Act, 2016) -- recommends the rates, exemptions, and other matters to ensure uniformity.

India chose the dual model to preserve the fiscal autonomy of states in a federal structure. The GST Council is chaired by the Union Finance Minister and includes finance ministers of all states/UTs. Decisions are taken by a three-fourths majority of weighted votes, with the Centre having one-third and all states together having two-thirds of the votes.

Key Features

# Feature Details
1 Model Dual -- both Centre and States levy GST simultaneously
2 Intra-State CGST (Centre) + SGST/UTGST (State/UT)
3 Inter-State IGST (Centre collects; shared with destination state)
4 Constitutional Basis 101st Amendment Act, 2016; Article 246A (concurrent power to tax)
5 GST Council Article 279A; chaired by Union Finance Minister
6 Voting 3/4 majority; Centre = 1/3 vote, States = 2/3 votes
7 Rate Slabs (post-2025) Primarily 5% and 18% (standard); 40% (luxury/sin goods)
8 Network GSTN (Goods and Services Tax Network) -- IT backbone

Current Status / Latest Data

  • GST Revenue (Feb 2026): Rs 1,83,609 crore (8% YoY growth); FY2024-25 full year: record Rs 22.08 lakh crore.
  • April-December FY2025-26: Gross GST collections of approximately Rs 16.5 lakh crore (8.6% growth over same period previous year).
  • Rate Rationalisation (GST 2.0, September 2025): The 56th GST Council meeting replaced the four-slab structure with primarily two standard rates -- 5% and 18%; a new 40% slab for luxury/sin/demerit goods.
  • Active Registrations: Over 1.51 crore GST-registered businesses (April 2025).
  • E-invoicing: Mandatory for turnover above Rs 5 crore from January 2025.
  • GST Compensation Cess: Being phased out; ended for most categories in September 2025; final categories (tobacco) from 1 February 2026.
  • GSTN: Processes over 1 billion invoices monthly; fully digital return filing.

UPSC Exam Corner

Prelims: Key Facts

  • India follows a dual GST model (Centre + State levy GST simultaneously)
  • Intra-state: CGST + SGST; Inter-state: IGST
  • GST Council under Article 279A; decisions by 3/4 majority
  • Centre has 1/3 weighted vote; all states together have 2/3
  • 101st Constitutional Amendment enabled GST (Article 246A)
  • GST subsumed 17 central/state taxes and 13 cesses

Mains: Probable Themes

  1. Analyse the rationale behind India's adoption of the dual GST model. How does it balance the imperatives of a unified market with fiscal federalism?
  2. Evaluate the role of the GST Council as a federal institution for cooperative fiscal governance
  3. Has the dual GST model achieved the goals of "One Nation, One Tax, One Market"? Discuss the challenges of rate multiplicity and compliance burden
  4. Critically examine the impact of the GST rate rationalisation (GST 2.0) on revenue, compliance, and the federal balance

Sources: PIB - Record GST Collection FY2024-25, GST Council - Revenue Data, Tata NexArc - GST Collection Feb 2026