The proposed GST in India would be based on the ‘dual GST’ model which envisages that both the central and state governments will simultaneously tax all transactions within a particular state involving the supply of goods and services under CGST Act and SGST Act, respectively. These taxes are deposited by the tax payers electronically and will go directly into the respective government’s CGST/SGST accounts.
Under the current regime, the powers to tax services and manufacturing transactions are with the central government whereas the power to tax sale transactions is with the State governments exclusively.
