Article 246A was inserted by the 101st Constitutional Amendment Act 2016 to enable the implementation of the Goods and Services Tax (GST). It grants special legislative powers to both Parliament and State Legislatures with respect to GST. This Article marked a major restructuring of fiscal federalism in India. Textual Essence Article 246A provides: The use of the phrase “notwithstanding” gives Article 246A overriding effect over the traditional distribution of legislative powers. Significance Special Concurrent Power Unlike the traditional division under the Seventh Schedule, Article 246A creates a unique concurrent power specifically for GST. Both: Exclusive Power for Inter-State Trade Parliament alone has authority over inter-State supply through Integrated GST (IGST), ensuring uniformity in cross-border transactions within India. Impact on Federal Structure Before GST: After Article 246A: It represents cooperative fiscal federalism, where taxation powers are shared rather than compartmentalised. Relationship with Other Articles Constitutional Innovation Article 246A is unique because: Conclusion Article 246A is the constitutional foundation of GST in India. It redefined legislative competence over indirect taxation by granting concurrent powers to Parliament and State Legislatures while reserving inter-State GST exclusively for Parliament. It represents a structural shift toward integrated fiscal federalism.

Overview The 101st Constitutional Amendment Act, 2016 introduced the Goods and Services Tax (GST) in India. It fundamentally restructured the country’s indirect tax system by enabling concurrent taxation powers to both the Union and the States. The Act came into force on 8 September 2016, and GST was implemented from 1 July 2017. Background Before this amendment, India had a fragmented indirect tax system consisting of multiple central and state taxes such as excise duty, service tax, VAT, entry tax and luxury tax. These created cascading effects and internal trade barriers. The amendment replaced this multi-layered system with a unified, destination-based tax regime. Key Constitutional Changes The amendment introduced several structural changes in the Constitution. Article 246A Article 269A Article 279A Amendments to Existing Provisions GST Council The Council institutionalised cooperative federalism in indirect taxation. Compensation to States The amendment provided for compensation to states for revenue loss arising from GST implementation for a period of five years (2017–2022). Significance Limitations Conclusion The 101st Constitutional Amendment Act represents one of the most significant fiscal reforms in independent India. By enabling GST, it redefined Centre–State fiscal relations and transformed India’s indirect taxation framework into a harmonised, destination-based system.

Meaning Excise duty is an indirect tax levied on the manufacture or production of goods within a country. It is imposed at the stage of manufacturing, but the burden is ultimately passed on to the final consumer. It differs from customs duty, which is levied on imports and exports. Nature of Tax The taxable event under excise was the act of manufacture. Constitutional Basis in India Before the introduction of GST: After GST (2017): Features Goods Traditionally Subject to Excise After GST, most goods were subsumed under GST except select items. Difference Between Excise and GST Feature Excise Duty GST Taxable Event Manufacture Supply Scope Goods only Goods + Services Level of Levy Central Centre + States Cascading Reduced via CENVAT Eliminated via seamless ITC GST shifted the focus from manufacture to supply and integrated the indirect tax structure. Economic Significance Excise duty historically: Even today, excise on fuel remains a major source of revenue for the Union government. Conclusion Excise duty was a key component of India’s pre-GST indirect tax system, levied on manufacture of goods. While largely subsumed under GST, it continues to apply to specific high-revenue and strategic commodities, particularly petroleum and tobacco.

Meaning Value Added Tax (VAT) is a multi-stage indirect tax levied on the value added at each stage of production and distribution of goods. It is ultimately borne by the final consumer, while businesses collect and remit the tax to the government. Concept of Value Addition VAT is charged only on the incremental value added at each stage, not on the total value of the product repeatedly. Example:If a manufacturer buys raw material for ₹100 and sells the finished product for ₹150, VAT is levied only on ₹50 (the value added), after adjusting for input tax credit. Key Features VAT in India VAT replaced the earlier sales tax system in most Indian states between 2005 and 2008. It aimed to create greater uniformity and reduce tax-on-tax distortion. Before GST (2017), VAT was: Because VAT was state-specific, tax rates differed between states, leading to internal trade distortions. Difference Between Sales Tax and VAT Under the old sales tax system, tax was levied on the full sale value at each stage without credit for taxes already paid. This caused cascading. VAT allows input tax credit, ensuring tax is imposed only on value addition. VAT vs GST Feature VAT GST Scope Goods only Goods + Services Levying Authority States Centre + States Uniformity State-specific Nationally harmonised Input Credit Limited to goods Seamless across goods & services GST subsumed VAT on most goods, except: Advantages Limitations Conclusion VAT was an important reform in India’s indirect tax evolution, introducing value-added taxation and reducing cascading effects. However, its limited scope and state-specific structure led to its replacement by the more comprehensive GST regime in 2017.

Meaning “One Nation, One Tax” refers to the creation of a unified indirect taxation framework across India through the Goods and Services Tax (GST). It signifies the replacement of multiple central and state indirect taxes with a harmonised system designed to integrate the country into a single common market. It does not imply a single tax rate, but a unified tax structure and compliance mechanism. Background Before GST was introduced in 2017, India had a fragmented indirect tax system. Central taxes included: State taxes included: Different states followed different tax rates and rules, leading to cascading taxation and internal trade barriers. GST was implemented on 1 July 2017 to replace this system. Constitutional Basis Structural Features India follows a Dual GST model: Thus, the system is unified in structure but federal in implementation. Objectives Economic Significance GST integrates domestic markets by removing inter-state tax barriers. The Input Tax Credit mechanism reduces double taxation across the value chain. A technology-driven system enhances compliance and broadens the tax base. The unified framework supports formalisation of the economy. Limitations The slogan simplifies a complex system. Therefore, it represents structural harmonisation rather than literal uniform taxation. Conclusion “One Nation, One Tax” symbolises India’s transition from a fragmented indirect tax regime to a unified, destination-based GST framework. While not a single-rate system, it has fundamentally restructured India’s internal market and fiscal federal architecture.

Constitutional Basis Article 275 of the Constitution of India provides for statutory grants-in-aid from the Union to certain States. These grants are charged on the Consolidated Fund of India and are mandatory in nature, unlike discretionary grants under Article 282. Nature and Purpose Article 275 embodies the principle of cooperative federalism and financial equity. Key Features Role of Finance Commission These grants may include: Grants for Scheduled Areas and Tribal Welfare Article 275(1) specifically provides for: This strengthens constitutional safeguards under the Fifth Schedule. Distinction from Article 282 Significance in Fiscal Federalism Conclusion Grants-in-aid under Article 275 are a foundational instrument of India’s fiscal federal structure. They operationalise financial equalisation, support tribal welfare, and ensure that States can deliver essential public services despite resource constraints.