Thecharge of tax, manner of payment, settlement and apportionment :
The inter-State seller will pay IGST on value addition after adjusting available credit of IGST, CGST, and SGST, in that order, on his purchases. The Exporting State will transfer to the Centre the credit of SGST used in payment of IGST. The Importing dealer will claim credit of IGST while discharging his output tax liability in his own State. The Centre will transfer to the importing State the credit of IGST used in payment of SGST. Further the IGST amount used for payment of CGST shall be transferred from IGST account to the CGST account.
The requirement of transfer of ITC under section 9 of the Act are illustrated below:
| Category | Transfer of credit |
| M/s X uses Rs 100 ITC-IGST for payment
of SGST in M. P. |
Centre transfers Rs 100 to SGST account
of M.P from the IGST collection |
| Mr X also uses Rs 100 ITC_IGST for
payment of CGST |
Centre transfers Rs 100 to CGST account
from the IGST collection |
Similar settlement/transfer has been envisaged in SGST and CGST Act when the ITC of SGST and ITC of CGST respectively is used for payment of IGST.
This settlement/transfer between the state and the Centre could be netted out for all interstate supplies during the period of settlement. In other words, for a particular state the settlement amount will be based on whether the state is net exporter or net importer during the period of settlement. The relevant information will also be
submitted to the Central Agency which will act as a clearing house mechanism, verify the claims and inform the respective governments to transfer the funds. However, the detailed modalities in this regard are yet to be worked out,