Question

Which of the following statements are correct regarding the 101st Constitutional Amendment Act?

i. It introduced Article 246A, empowering both Parliament and state legislatures to levy GST on goods and services.

ii. It repealed Article 268A, which dealt with service tax levied by the Union and collected by both Union and states.

iii. It mandated that the GST Council be chaired by the Prime Minister of India.

• A. i and ii
• B. ii and iii
• C. i and iii
• D. i, ii, and iii

Answer 1

Answer:

A. i and ii

101st Constitutional Amendment Act, 2016

• This amendment is a landmark act that paved the way for the introduction of the Goods and Services Tax (GST) in India.
• Statement i: Introduction of Article 246A
  • Article 246A was specifically introduced to grant concurrent powers to both the Parliament and the State Legislatures to make laws with respect to Goods and Services Tax.
  • This implies that GST is a dual tax, levied by both the Union and the States.
  • This article also states that Parliament has exclusive power to make laws with respect to Goods and Services Tax where the supply of goods or services takes place in the course of inter-State trade or commerce.
• Statement ii: Repeal of Article 268A
  • Article 268A of the Constitution previously dealt with the service tax levied and collected by the Union Government but shared with the States.
  • The 101st Amendment Act effectively abolished this and subsumed it under the GST regime, thus removing the need for this separate article.
  • Background Fact: Before GST, service tax was levied and collected by the Central Government. Certain other indirect taxes were levied by the Centre and collected by the States and vice-versa, creating a complex tax structure.
• Statement iii: GST Council Chairpersonship
  • The GST Council is a constitutional body established by Article 279A.
  • As per Article 279A(4)(a), the Union Finance Minister is the Chairperson of the GST Council.
  • The Union Minister of State for Revenue or Finance, and the Finance or any other Minister nominated by each State Government are also members of the Council.
  • The Prime Minister of India does not chair the GST Council.
• Key Takeaway for Exams: The 101st Amendment Act is crucial for understanding India's indirect tax reforms. It is frequently tested in competitive exams due to its significant economic and constitutional implications. Remember the concurrent taxing power for GST and the role of the Finance Minister in the GST Council.