Which of the following Constitution Amendment Acts introduced GST (Goods and Services Tax) in course of inter-state trade or commerce?
- AOption (a)
Constitution (One Hundred and First Amendment) Act
- BOption (b)
Constitution (One Hundred and Second Amendment) Act
- COption (c)
Constitution (One Hundred and Fourth Amendment) Act
- DOption (d)
Constitution (One Hundred and Sixth Amendment) Act
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Correct answer
Constitution (One Hundred and First Amendment) Act
Why this answer is correct
The correct answer is Constitution (One Hundred and First Amendment) Act.
Key Points
- The Constitution (One Hundred and First Amendment) Act, 2016, introduced the Goods and Services Tax (GST) in India, which came into effect on 1 July 2017.
- This amendment added a new Article 246A to the Indian Constitution, granting both Parliament and State Legislatures the power to make laws regarding GST.
- GST replaced multiple indirect taxes like VAT, service tax, and excise duty with a unified tax structure to simplify the taxation system.
- The GST Council, established under Article 279A, was created to recommend GST rates and policies, ensuring cooperative federalism in taxation.
- GST operates as a dual tax structure: the Central GST (CGST) and State GST (SGST) for intra-state trade, and Integrated GST (IGST) for inter-state trade.
Additional Information
- Goods and Services Tax (GST):
- GST is a destination-based indirect tax that is levied on the consumption of goods and services.
- It is categorized into CGST, SGST, UTGST (for Union Territories), and IGST, depending on the nature of the transaction.
- GST has subsumed various taxes like Central Excise Duty, Service Tax, VAT, and Entry Tax, among others.
- GST Council:
- The GST Council is a constitutional body chaired by the Union Finance Minister.
- It includes the Union Minister of State for Finance and Finance Ministers of all states as members.
- The Council recommends tax rates, exemptions, and procedural guidelines for GST implementation.
- Impact of GST:
- GST has simplified the tax structure, reduced cascading effects, and promoted ease of doing business in India.
- It has increased tax compliance through mechanisms like e-invoicing and input tax credit.
- GSTN (Goods and Services Tax Network):
- GSTN is a non-profit organization responsible for the technological infrastructure of GST in India.
- It facilitates registration, return filing, and payment of taxes for taxpayers and serves as the backbone of the GST system.