Why was constitutional amendment needed for introducing GST?
- A.States were not willing to agree with the Union for introduction of GST without amendment in the Constitution.
- B.GST was to be implemented on concurrent base and Article 246 was inadequate for such a case.
- C.The Empowered Committee of Finance Ministers had recommended for constitutional amendment.
- D.The GST Council had recommended for constitutional amendment so that its power enhances.
Correct answer
Explanation
The correct answer is B. GST is levied by the Union and the States together on the same supply, and Article 246, which splits taxing powers between them through separate lists, did not allow such a concurrent tax.
Before GST, the Seventh Schedule gave the Union taxes such as excise duty and service tax, and gave the States sales tax and entry tax, each in its own list. A single tax on goods and services shared by both levels could not fit into that division. The Constitution (One Hundred and First Amendment) Act, 2016 therefore inserted Article 246A, which gives both Parliament and the State legislatures power to make laws on GST, and Article 279A, which created the GST Council. GST came into force on 1 July 2017.
A is wrong: the amendment was a legal necessity, not a bargaining demand by the States. C is wrong: the Empowered Committee of State Finance Ministers worked on the design of GST, but its view was not the reason an amendment was needed. D is wrong: the GST Council was itself created by the amendment, so it could not have recommended it.
Exam tip: 101st Amendment 2016; Article 246A = concurrent GST power; Article 279A = GST Council; GST from 1 July 2017.
Practice Questions
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