Understanding GST Jurisdictions in India

How India's GST jurisdiction structure works

India operates under a dual GST model, meaning both the central and state governments have the authority to levy GST. This is different from many countries where only one level of government administers the tax.

For most businesses, the jurisdiction that matters most is where the supply takes place and where the buyer is located.

Federal vs. state-level registration

There are two registration paths in India, depending on your business situation.

Federal (nationwide) registration applies to foreign businesses providing OIDAR services, which includes SaaS, from outside India to unregistered consumers. Instead of registering state by state, a foreign OIDAR provider registers once at the federal level and obtains a single GST registration that covers all of India.

State-wise registration applies to businesses that are physically present in India. Once a domestic business crosses the GST registration threshold, it must register separately in each state where it has a physical presence and makes taxable supplies, regardless of how much revenue it generates in that particular state.

How the place of supply determines the tax type

The place of supply rules determine whether CGST and SGST or IGST applies to a given transaction:

• If the seller and buyer are in the same state: CGST and SGST apply, each at 9%, totaling 18%.

• If the seller and buyer are in different states, or the sale is cross-border: IGST applies at 18%.

For foreign businesses making sales into India, all supplies are treated as interstate or cross-border, so IGST at 18% always applies.

Special Economic Zones (SEZs)

Supplies made to a Special Economic Zone (SEZ) developer or unit are zero-rated, meaning GST is charged at 0%.

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