# Understanding how GST applies to your business in India

### GST rates are based on HSN codes

In India, the government assigns every product an HSN (Harmonised System of Nomenclature) code, also known globally as the HS code. Each HSN code has a corresponding GST rate—commonly 5%, 12%, 18%, or 28%.

As a merchant, you must correctly assign both the HSN code and the corresponding GST rate when listing products on Fynd Commerce .

**Examples:**

* **T-shirts**
  * HSN code: 61091000
  * Description: Cotton T-shirts, knitted or crocheted
  * GST rate: 5%
* **Shoes**
  * HSN code: 64041900
  * Description: Sports footwear with rubber or plastic soles and textile uppers
  * GST rate: 18%


### GST type depends on the delivery location

India follows a destination-based GST model. This means GST is charged based on where the product is delivered—not where your store is located.

* If the delivery is within the same state or Union Territory (UT): **CGST + SGST/UTGST** applies.
* If the delivery is to a different state or UT: **IGST** applies.


| Store location | Customer delivery location | GST type |
|  --- | --- | --- |
| Same state | Same state | CGST + SGST |
| Same Union Territory | Same Union Territory | CGST + UTGST |
| Different state/UT | Different state/UT | IGST |


**GST component breakdown:**

* **CGST** (Central GST): Collected by the central government.
* **SGST** (State GST): Collected by the state government.
* **UTGST** (Union Territory GST): Applicable in Union Territories, collected by the UT administration.
* **IGST** (Integrated GST): Collected by the central government and distributed to the destination state or UT.


### Example scenarios

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Scenario 1: Intra-state sale (CGST + SGST)
* Store location: Maharashtra
* Delivery location: Maharashtra
* Product GST rate: 12%
* Tax applied: 6% CGST + 6% SGST


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Scenario 2: Inter-state sale (IGST)
* Store location: Delhi
* Delivery location: Karnataka
* Product GST rate: 18%
* Tax applied: 18% IGST


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Scenario 3: Sale within a Union Territory (CGST + UTGST)
* Store location: Chandigarh
* Delivery location: Chandigarh
* Product GST rate: 5%
* Tax applied: 2.5% CGST + 2.5% UTGST


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Scenario 4: Sale from a state to a Union Territory (IGST)
* Store location: Delhi
* Delivery location: Puducherry
* Product GST rate: 28%
* Tax applied: 28% IGST


### Union Territories where UTGST applies

* Andaman and Nicobar Islands
* Chandigarh
* Dadra and Nagar Haveli and Daman and Diu
* Lakshadweep
* Ladakh
* Puducherry