UTGST Full Form, Meaning and Applicability of UTGST

What is UTGST?

UTGST full form or UTGST meaning is Union Territory Goods and Service Tax. UTGST was introduced to streamline the tax system and achieve uniformity in tax rates. UTGST is applicable when goods or services or both are consumed in the supplied regions of India that include Andaman and Nicobar Islands, Lakshadweep, Dadra & Nagar Haveli and Daman & Diu, Ladakh and Chandigarh, termed as Union territories of India. Union Territory GST will be charged simultaneously with the Central goods and services tax (CGST).

What is UTGST and when is it applicable?

The State Goods and Services Tax (SGST) cannot be levied by a Union Territory without a governing body under GST. To decrease this challenge, the GST Council has chosen to have a Union Territory GST Law (UGST) similar to SGST. Though SGST can be executed in Union Territories, for instance, New Delhi and Puducherry, both have individual governing bodies and can be considered States according to the GST process.

Here is the complete list of Union Territories for the Applicability of UTGST

UTGST is applicable when there is a separate governing body. Here is the list of the Union Territories where the UTGST Act is applicable:

(i) Chandigarh

(ii) Lakshadweep

(iii) Ladakh

(iv) Dadra and Nagar Haveli and Daman and Diu

(v) Andaman & Nicobar islands

Administration

There are two types of union territories in India:

• Union territory with the legislature
• Union territory without legislature

Currently, there are two union territories with the legislature; Delhi and Puducherry. These types of union territory have a defined legislature and an elected government. Hence, for these states SGST is applicable. The central government directly controls the other union territories. Union Territories that are governed now by the Central Government have a Lieutenant Governor as an executive. He is the representative of the President of India and appointed by the Central government. The UTGST Act governs these UTs.

UTGST Applicability

UTGST is applicable when goods or services are supplied within a Union Territory (intra-UT). Output liabilities of the taxable person as per the UTGST Act can are often explained as follows:

UTGST Rates

Union Territory Goods and Services which is the full form of UTGST Tax has the same rates as State Goods and Services Tax. So, the UTGST rates are 0%, 5%, 12%, 18% and 28% respectively. Further, the exemption rules for goods and services are also similar to SGST.

UTGST Example

Here we see how the different elements under GST work in India. Suppose the GST rate applicable to a product is 18%.

Conclusion

The GST for Union Territory is referred to as UTGST, which stands for Union Territory Goods and Services Tax. UTGST is imposed by the respective Union Territory governments and is similar to State Goods and Services Tax (SGST) levied by state governments. UTGST simplified taxes, curbing evasion and boosting revenue for the Central Government and Union Territories, aiding development and welfare programs. Understanding Union Territory GST is crucial for compliance and operations in Union Territories.

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