Input Tax Credit under GST has been introduced in order to avoid the cascading of taxes that’s prevalent in the present tax regime. It’s one of the key features of the Goods and Services Tax. In simple terms, the cascading of taxes means ‘tax on tax’.
As per the present taxation regime, the credit of taxes that is being levied by the Central Government is not available as a set-off for payment of taxes that is being levied by the State Governments and vice-versa.