Part XI - Relations • Article

Article 246A Simplified: Special provision with respect to goods and services tax

Article 246A grants concurrent (shared) power to both Parliament and State Legislatures to levy Goods and Services Tax (GST) on transactions. However, Parliament holds exclusive power to legislate and levy GST on the inter-state trade or supply of goods and services.

Official Text

(1) Notwithstanding anything contained in articles 246 and 254, Parliament, and, subject to clause (2), the Legislature of every State, have power to make laws with respect to goods and services tax imposed by the Unionor by such State.. Subs. by s. 29 and Sch., ibid., for "in Part A or Part B of the First Schedule" (w.e.f. 1-11-1956). 3. Ins. by the Constitution (One Hundred and First Amendment) Act, 2016, s. 2 (w.e.f. 16-9-2016). (2) Parliament has exclusive power to make laws with respect to goods and services tax where the supply of goods, or of services, or both takes place in the course of inter-State trade or commerce. Explanation.-The provisions of this article, shall, in respect of goods and services tax referred to in clause (5) of article 279A, take effect from the date recommended by the Goods and Services Tax Council.]

Simple Meaning

Explain Like Ten

This special rule lets the central government and state governments tax shopping and services together. But only the central government can tax items sent from one state to another.

Student Mode

Inserted by the 101st Constitutional Amendment Act, 2016, Article 246A gives concurrent power to Parliament and State Legislatures to make laws regarding GST. However, clause (2) reserves exclusive power to Parliament for inter-state supplies. It operates notwithstanding Articles 246 and 254.

Example

For a local sale of a laptop within Maharashtra, both Central GST (CGST) and State GST (SGST) are applied using concurrent powers. But if a seller in Karnataka ships a laptop to a buyer in Tamil Nadu, only Parliament can levy Integrated GST (IGST).

Key Takeaway

Article 246A provides the unique constitutional basis for the joint Union-State administration of the Goods and Services Tax (GST) system.

FAQs

Which constitutional amendment introduced Article 246A?

The 101st Constitutional Amendment Act, 2016.

Who has exclusive power to levy GST on inter-state trade?

Parliament has the exclusive power under Article 246A(2).

Quiz

Under Article 246A, who is authorized to make laws regarding intra-state GST?

Answer: Both Parliament and State Legislatures concurrently

Which amendment created the GST framework in the Indian Constitution?

Answer: 101st Amendment