SGST is a part of Goods and Service Tax (GST).
SGST means State Goods and Service Tax, one of the three categories under Goods and Service Tax (CGST, IGST, and SGST) with a concept of one tax one nation. SGST falls under State Goods and Service Tax Act 2016.
For easy understanding, when SGST is being introduced, the present state taxes of State Sales Tax, VAT, Luxury Tax, Entertainment tax (unless it is levied by the local bodies), Taxes on lottery, betting and gambling, Entry tax not in lieu of Octroi, State Cesses and Surcharges in so far as they relate to supply of goods and services etc. are subsumed.
The revenue collected under SGST is for State Government.
Under GST, SGST is a tax levied on Intra State supplies of both goods and services by the State Government and will be governed by the SGST Act. As explained above, CGST will also be levied on the same Intra State supply but will be governed by the Central Government.
Note: Any tax liability obtained under SGST can be set off against SGST or IGST input tax credit only.