GST State Code List and Jurisdiction: An Overview

At the time of GST registration, a customer must declare the authority of jurisdiction to inform on the location of the enterprise. This is the primary reason why jurisdiction has become so important to taxpayers.

The GST is divided into three types: CGST (Central Goods and Services Tax), SGST (State Goods and Services Tax), and IGST (Integrated Goods and Service tax which is levied by both the centre and the state). Before introducing the Goods and Services Tax (GST), customers paid various direct and indirect taxes.  These taxes are placed on goods and services throughout the logistics system. GST State Code List is a code list that contains unique two-digit codes assigned to each state and union territory in India under the Goods and Services Tax (GST) regime

Did You Know? The GST state code list is based on the Indian Census of 2011, which is the most recent census conducted in India.

GST State Code List

The government categorised jurisdiction primarily on the PIN code of separate districts, places, and geographical locations to make the GST registration procedure easier for people and enterprises. This allows the company to earn GST from the beneficiary while claiming input credit. As a result, the CGST Act 2017 requires the following individuals to enrol for GST and apply for a GSTIN.

State Codes Under GST

The first two digits of the GSTIN format identify the state code where the business is registered under GST legislation. The state denotes the state in which a business is situated or undertaken and is thus registered under GST from that state.

Each state in India is assigned a state code to facilitate the identification of corporate entities. As a result, the GST state codes and alphabetical codes for various states are as follows:

Also Read: GST on Laptops and Accessories and the Applicable HSN Codes

Advantages of GST Codes

A GST code is issued for all legal and business objectives for transactions involving the company identity and relevant persons.

1. Foreign Investment is on the Rise

After adopting GST, India has become a single market, and international investment has increased. Commodities produced in India have become considerably more competitive in the global market due to their lower pricing, resulting in more significant exports.
2. Reduced Taxes 

Before the implementation of GST, many taxes and levies have subsequently been replaced by Central and State GST.

3. Lowering the Cost of Doing Business

The Goods and Services Tax (GST) has changed the VAT system in India. We are no longer required to pay varied tax amounts in multiple states. We have already abolished several taxes and levies on our operations because it is a single taxation system for all Indian states.

4. Clarity

The tax office now functions without corruption. The documents reflect the tax levied, thus making it simpler and clearer.

Also Read: Understand The Format and Requirements of Consent Letter For GST Registration

Where is GST Code Required?

According to the GST rules, every business organisation with many branches in particular states can only have one form of GST identification code. The GST state code list is used for the following purposes:
1. Goods and Services Tax Identification Number

It begins with the state-wise GST code. The values in the first place serve to denote the country code. One example is the GST number 27xxxxxxxxxxyzz of a specific location. The two numerals at the beginning of the number denote the state. In this situation, 27 represents the Maharashtra GST code. The entire description of the 15-digit GST number is as follows:

• The first two numbers reflect the state-wise GST code.
• The next ten digits are the pan card number.
• The registration number is represented by a single digit (y in the example).
• The checksum and default value is represented by the last two digits (ZZ in the example).

2. Supply Location and Delivery Area

Identifying whether an IGST number will be applied and whether SGST or CGSR will be levied is critical. If the supplier's supply area and state-wise GST code vary, only IGST is levied. Nevertheless, if both the supply and state-wise GST code is identical, the authorities will collect SGST and CGST.
Classification of GST Jurisdiction

The GST ACT of 2017 allocates the jurisdictions evenly between the union/centralised and state chapters.

• Regional Jurisdiction: It is handled and assessed by the local state government.
• Central Jurisdiction: It is managed by the Centre.

Here is how the state and central jurisdiction are defined under the CGST

a. Taxpayers having a turnover of less than ₹1.5 crores should share in state administration. The remaining 10%, on the other hand, is with central administration.

b. While more than half of those who pay taxes have a turnover of ₹1.5 crore or more with the state administration. At the same time, the remaining 50% should be administered centrally.

For example, the owner of 'zone all' concentrates on the development and expansion strategy with excellent and straightforward access to the global market rather than reducing state-wise tax techniques.

Also Read: Tracking GST Payments And Dealing With GST Payment Failures

Identifying Your Jurisdiction

There are numerous approaches to identifying jurisdiction for a particular GSTIN or taxpayer. While filing for a GST registration, the taxpayer must be cautious about submitting a comprehensive and exact address of his or her company location. That is crucial information for correctly defining the jurisdiction when mentioning it in the GST registration application, and it helps to avoid issues later on.

1. State Jurisdiction 

A taxpayer may be asked to identify the relevant State jurisdiction before obtaining GST registration. Taxpayers must check the district and sector on the applicable State commercial tax, VAT, or Sales tax portal to determine the department's State jurisdiction. Every state has specialised websites and websites that include this information.

2. Central Jurisdiction 

The taxpayer must pick his Central jurisdiction and region in the same manner as he must select his state jurisdiction.

Follow the steps hereafter.

• The CBIC maintains a specialised web page for searching for Central jurisdiction, titled "Know your Jurisdiction," which is accessible through any browser at this internet Address<cbic-gst.gov.in)>. 
• Choose the zone, then click " " next to the Commissionerate that corresponds to the firm in the list. 
• Next, in the next step, click the " " symbol next to the specific division description that corresponds more directly to the firm location.
• Choose an option from the drop-down menu under the previously defined division. When a user selects a tile, he may read the displayed description.
• The jurisdiction might be established based on the first letter of the taxpayers' names placed in a certain pin code/s.

After registering, a taxpayer can use the certificate (Form REG-06) to identify his state and central jurisdiction at any time.
 

Conclusion

GST offers several beneficial implications for small and medium-sized firms, including various perks, simplicity of use, and digitised and simplified processes. It enables prospective business owners to launch their companies quickly and gives their concepts a way forward. The GST state code list is critical to determine whether the GSTIN is authentic. It aids in determining if an invoice is genuine or fraudulent, and it enables a taxpayer to calculate the tax due using the supplier's and location of supply codes.
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