{"id":6066,"date":"2026-03-04T03:16:47","date_gmt":"2026-03-03T21:46:47","guid":{"rendered":"https:\/\/vajiramandravi.com\/upsc-exam\/?p=6066"},"modified":"2026-03-11T12:43:29","modified_gmt":"2026-03-11T07:13:29","slug":"gst-council","status":"publish","type":"post","link":"https:\/\/vajiramandravi.com\/upsc-exam\/gst-council\/","title":{"rendered":"GST Council, Constitutional Provisions, Functions"},"content":{"rendered":"<p><span style=\"font-weight: 400\">The Goods and Services Tax (GST) Council was established under the 101st Constitutional Amendment Act, 2016. The GST Council is a constitutional body responsible for addressing GST-related issues and providing recommendations to both the Union and State governments on matters of taxation.<\/span><\/p>\r\n<p><span style=\"font-weight: 400\">It also plays a crucial role in shaping the GST framework and ensuring its effective implementation across the country.<\/span><\/p>\r\n<h2><span style=\"font-weight: 400\">GST Council Overview<\/span><\/h2>\r\n<p><span style=\"font-weight: 400\">The GST Council is a pivotal <\/span><a href=\"https:\/\/vajiramandravi.com\/upsc-exam\/constitutional-bodies\/\" target=\"_blank\"><span style=\"font-weight: 400\">constitutional body<\/span><\/a><span style=\"font-weight: 400\"> tasked with overseeing the implementation and administration of the GST in India. Formed under the 101st Constitutional Amendment through Article 279A, the GST Council plays a critical role in creating a harmonized tax structure and fostering a unified national market for goods and services. In line with this, accordingly, the <\/span><a href=\"https:\/\/vajiramandravi.com\/upsc-exam\/president-of-india\/\" target=\"_blank\"><span style=\"font-weight: 400\">President of India<\/span><\/a><span style=\"font-weight: 400\"> issued the order in 2016 and constituted the Council, with its Secretariat located in New Delhi.<\/span><\/p>\r\n<ul>\r\n\t<li style=\"font-weight: 400\"><b>Vision:<\/b><span style=\"font-weight: 400\"> The vision of the GST Council is to set the highest standards of cooperative federalism, making it the first constitutional body empowered to make significant decisions regarding GST.\u00a0<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><b>Mission<\/b><span style=\"font-weight: 400\">: Its mission focuses on evolving a GST structure through wide consultations, aiming to create a user-friendly, information technology-driven system.<\/span><\/li>\r\n<\/ul>\r\n<h2><span style=\"font-weight: 400\">Objectives of GST Council\u00a0<\/span><\/h2>\r\n<p><span style=\"font-weight: 400\">GST Council has been instrumental in shaping policies, settling disputes, and ensuring the seamless execution of the GST system throughout the nation since its establishment. Its key objectives include the following:<\/span><\/p>\r\n<ul>\r\n\t<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">To ensure a smooth implementation of GST.\u00a0<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">To simplify the tax structure, eliminate cascading taxes, and reduce compliance costs.<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">To monitor all the taxation processes to avoid fraudulent processes.<\/span><\/li>\r\n<\/ul>\r\n<h2><span style=\"font-weight: 400\">GST Council Constitutional Provisions\u00a0<\/span><\/h2>\r\n<p><span style=\"font-weight: 400\">The GST Council, established under the 101st Constitutional Amendment Act, is a constitutional body tasked with making key recommendations on Goods and Services Tax (GST). Significant constitutional provisions related to the Council include:<\/span><\/p>\r\n<ul>\r\n\t<li style=\"font-weight: 400\"><b>Formation of the GST Council: <\/b><span style=\"font-weight: 400\">Article 279A (1) mandates the President to form the GST Council within 60 days of the commencement of the 101st Amendment Act, 2016.<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><b>GST Levy Date Recommendation:<\/b><span style=\"font-weight: 400\"> Article 279A (5) empowers the GST Council to recommend the date for levying GST on specific goods like petroleum, diesel, petrol, natural gas, and aviation fuel.<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><b>Guiding Principles for Functioning: <\/b><span style=\"font-weight: 400\">Article 279A (6) ensures that the GST Council's actions promote a unified national market and harmonize GST structures.<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><b>Procedural Framework: <\/b><span style=\"font-weight: 400\">Article 279A (8) assigns the GST Council the responsibility to establish procedures for carrying out its functions.<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><b>Validity of GST Council Proceedings:<\/b><span style=\"font-weight: 400\"> Article 279A (10) ensures the validity of GST Council proceedings despite vacancies or flaws, as long as they do not affect the merits or procedural integrity.<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><b>GST on Specific Goods:<\/b><span style=\"font-weight: 400\"> Article 279A (11) tasks the GST Council with resolving disputes between the Government of India and States regarding GST implementation.<\/span><\/li>\r\n<\/ul>\r\n<h2><span style=\"font-weight: 400\">GST Council Composition<\/span><\/h2>\r\n<p><span style=\"font-weight: 400\">According to Article 279A of the amended Constitution, the GST Council, a collaborative body between the Centre and the States, consists of the following members:<\/span><\/p>\r\n<table>\r\n<tbody>\r\n<tr>\r\n<td class=\"tb-color\">\r\n<p><b>Chairperson<\/b><\/p>\r\n<\/td>\r\n<td class=\"tb-color\">\r\n<p><span style=\"font-weight: 400\">- The Union Finance Minister<\/span><\/p>\r\n<\/td>\r\n<\/tr>\r\n<tr>\r\n<td>\r\n<p><b>Vice Chairperson<\/b><\/p>\r\n<\/td>\r\n<td>\r\n<p><span style=\"font-weight: 400\">- The GST Council members elect a Vice-Chairperson from among themselves for a period they decide.<\/span><\/p>\r\n<\/td>\r\n<\/tr>\r\n<tr>\r\n<td>\r\n<p><b>Members\u00a0<\/b><\/p>\r\n<\/td>\r\n<td>\r\n<p><span style=\"font-weight: 400\">- Union Minister of State for Revenue or Finance.\u00a0<\/span><\/p>\r\n<p><span style=\"font-weight: 400\">- State Minister for Finance, Taxation, or a nominated Minister.<\/span><\/p>\r\n<\/td>\r\n<\/tr>\r\n<tr>\r\n<td>\r\n<p><b>Permanent Invitee<\/b><\/p>\r\n<\/td>\r\n<td>\r\n<p><span style=\"font-weight: 400\">- Chairperson of the Central Board of Indirect Taxes and Customs (CBIC) (non-voting).<\/span><\/p>\r\n<\/td>\r\n<\/tr>\r\n<tr>\r\n<td>\r\n<p><b>Ex-officio Secretary<\/b><\/p>\r\n<\/td>\r\n<td>\r\n<p><span style=\"font-weight: 400\">- Union Revenue Secretary from the Ministry of Finance.<\/span><\/p>\r\n<\/td>\r\n<\/tr>\r\n<\/tbody>\r\n<\/table>\r\n<h2><span style=\"font-weight: 400\">Functions of GST Council<\/span><\/h2>\r\n<p><span style=\"font-weight: 400\">The functions of the GST Council are outlined in <\/span><b>Article 279A (4)<\/b><span style=\"font-weight: 400\">. It mandates the Council to provide recommendations to both the Union and State governments on various aspects of GST, such as tax rates, exemptions, threshold limits, and other matters related to its implementation and administration.<\/span><\/p>\r\n<ul>\r\n\t<li style=\"font-weight: 400\"><b>Taxes to be Subsumed<\/b><span style=\"font-weight: 400\">: The taxes, cesses, and surcharges levied by the Union, the States, and the local bodies which may be subsumed in the goods and services tax.<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><b>Goods and Services Subject to GST:<\/b><span style=\"font-weight: 400\"> The goods and services that may be subjected to, or exempted from, the GST.<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><b>Model GST Laws and Principles<\/b><span style=\"font-weight: 400\">: Model GST Laws, principles of levy, apportionment of GST levied on supplies in the course of<\/span> <span style=\"font-weight: 400\">inter-state trade or commerce under<\/span><b> article 269A,<\/b><span style=\"font-weight: 400\"> and the principles that govern the place of supply.<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><b>Threshold Turnover Limit<\/b><span style=\"font-weight: 400\">: The threshold limit of turnover below which goods and services may be exempted from GST.<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><b>GST Rates: <\/b><span style=\"font-weight: 400\">The rates include floor rates with bands of GST.\u00a0<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><b>Special Rates for Emergencies: <\/b><span style=\"font-weight: 400\">Any special rate or rates for a specified period to raise additional resources during any natural calamity or disaster.<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><b>Special Provisions for Specific States:<\/b><span style=\"font-weight: 400\"> Special provisions concerning the States of Arunachal Pradesh, Assam, Jammu and Kashmir, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, Himachal Pradesh, and Uttarakhand;<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><b>Other Matters Related to GST<\/b><span style=\"font-weight: 400\">: Any other matter relating to the GST, as the Council may decide.\u00a0<\/span><\/li>\r\n<\/ul>\r\n<h2><span style=\"font-weight: 400\">Working of GST Council<\/span><\/h2>\r\n<p><span style=\"font-weight: 400\">The GST Council works as a collaborative platform where the Union and State Governments discuss, deliberate, and make decisions on GST-related matters. Its functioning ensures that both levels of government are represented, promoting cooperation and inclusivity. Key aspects of its working include the following:<\/span><\/p>\r\n<ul>\r\n\t<li style=\"font-weight: 400\"><b>Quorum Requirement: Article 279A (7)<\/b><span style=\"font-weight: 400\"> states that at least one-half of the total members of the GST Council must be present to constitute the quorum for its meetings<\/span><b>.<\/b><\/li>\r\n\t<li style=\"font-weight: 400\"><b>Decision-Making Process: Article 279A (9)<\/b><span style=\"font-weight: 400\"> specifies that every decision of the GST Council must be made at a meeting with a majority of not less than three-fourths of the weighted votes of the members present and voting.<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><b>Vote Weightage: <\/b><span style=\"font-weight: 400\">The vote of the Central Government carries a weightage of one-third of the total votes cast at the meeting.<\/span>\r\n<ul>\r\n\t<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">The collective votes of all State Governments carry a weightage of two-thirds of the total votes cast.<\/span><\/li>\r\n<\/ul>\r\n<\/li>\r\n<\/ul>\r\n<h2><span style=\"font-weight: 400\">GST Council Meetings Outcomes<\/span><\/h2>\r\n<p><span style=\"font-weight: 400\">GST Council\u2019s decisions have a direct impact on the tax burden of businesses and consumers and on the overall economic environment of the country. Some of the major outcomes of the GST Council include:<\/span><\/p>\r\n<ul>\r\n\t<li style=\"font-weight: 400\"><b>Dual GST Model<\/b><span style=\"font-weight: 400\">: The GST Council has recommended implementing a<\/span> <span style=\"font-weight: 400\">dual GST model in India, under which both the Central and State Governments levy GST on the supply of goods and services.<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><b>Five Tax Slabs:<\/b><span style=\"font-weight: 400\"> The GST Council has classified goods and services into five tax slabs including <\/span><b>0%, 5%, 12%, 18%, and 28%. <\/b><span style=\"font-weight: 400\">Some goods and services have also been exempted from GST, while others have been subjected to additional cesses on top of the applicable GST rate.<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><b>\u00a0GST Compliance System: <\/b><span style=\"font-weight: 400\">The GST Council has implemented a comprehensive GST compliance system, including an online portal for filing GST returns and making tax payments.<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><b>Reduction of Tax Burden<\/b><span style=\"font-weight: 400\">: The GST Council has reduced the compliance burden on businesses by allowing businesses to avail of input tax credits for GST paid on their purchases and allowing for the composition scheme for small businesses.<\/span><\/li>\r\n<\/ul>\r\n<h2><span style=\"font-weight: 400\">GST Council Recent Developments<\/span><\/h2>\r\n<p><span style=\"font-weight: 400\">The GST Council has recently convened its 53rd, 54th, and 55th meetings, introducing several significant changes to India's GST framework. Below is a summary of the key developments from these meetings:\u00a0<\/span><\/p>\r\n<ul>\r\n\t<li><b>53rd GST Council Meeting:<\/b><\/li>\r\n<\/ul>\r\n<ul>\r\n\t<li><b>GST Rate Adjustments:<\/b><span style=\"font-weight: 400\"> The Council reduced the GST rate on cartons, boxes, and cases made of both corrugated and non-corrugated paper or paperboard from 18% to 12%.<\/span><\/li>\r\n<\/ul>\r\n<ul>\r\n\t<li style=\"list-style-type: none\">\r\n<ul>\r\n\t<li style=\"list-style-type: none\">\r\n<ul>\r\n\t<li style=\"font-weight: 400\"><b>GST Rate on Milk Cans:<\/b><span style=\"font-weight: 400\"> The Council set the GST rate on all milk cans made of steel, iron, or aluminium at 12%, irrespective of their intended use.<\/span><\/li>\r\n<\/ul>\r\n<\/li>\r\n<\/ul>\r\n<\/li>\r\n<\/ul>\r\n<ul>\r\n\t<li><b>54th GST Council Meeting:\u00a0<\/b><\/li>\r\n<\/ul>\r\n<ul>\r\n\t<li style=\"list-style-type: none\">\r\n<ul>\r\n\t<li style=\"font-weight: 400\"><b>Cancer Drugs:<\/b><span style=\"font-weight: 400\"> The Council recommended the reduction of the GST rate on cancer medications, including Trastuzumab Deruxtecan, Osimertinib, and Durvalumab, from 12% to 5%.<\/span><\/li>\r\n<\/ul>\r\n<\/li>\r\n\t<li style=\"font-weight: 400\"><b>55th GST Council Meeting:<\/b><span style=\"font-weight: 400\">\u00a0<\/span>\r\n<ul>\r\n\t<li style=\"font-weight: 400\"><b>Reduction in GST Rate on Fortified Rice Kernel (FRK):<\/b><span style=\"font-weight: 400\"> The Council recommended reducing the GST rate on FRK, classified under HS code 1904, to 5%.<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><b>Exemption of GST on Gene Therapy:<\/b><span style=\"font-weight: 400\"> It was proposed to fully exempt GST on gene therapy treatments, recognizing their critical role in advanced medical care.<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><b>Increase in GST Rate on Sale of Used Vehicles:<\/b><span style=\"font-weight: 400\"> The GST rate on the margin (difference between purchase and selling price) on the sale of all old and used vehicles, including electric vehicles, was recommended to be increased from 12% to 18%.\u00a0<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><b>Compensation Cess<\/b><span style=\"font-weight: 400\">: The GST Council proposed reducing the Compensation Cess rate to 0.1% on supplies to merchant exporters, aligning it with the GST rate on such supplies.<\/span><\/li>\r\n<\/ul>\r\n<\/li>\r\n<\/ul>\r\n<h2><span style=\"font-weight: 400\">GST Council UPSC PYQs<\/span><\/h2>\r\n<p><b>Question1.<\/b><span style=\"font-weight: 400\">\u00a0 What is\/are the most likely advantages of implementing \u2018Goods and Services Tax (GST)\u2019?<\/span><b> (UPSC Prelims 2017)<\/b><\/p>\r\n<ol>\r\n\t<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">It will replace multiple taxes collected by multiple authorities and will thus create a single market in India.<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">It will drastically reduce the \u2018Current Account Deficit\u2019 of India and will enable it to\u00a0 increase its foreign exchange reserves.<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">It will enormously increase the growth and size of the economy of India and will enable it to overtake China in the near future.<\/span><\/li>\r\n<\/ol>\r\n<p><span style=\"font-weight: 400\">Select the correct answer using the code given below:<\/span><\/p>\r\n<ol>\r\n\t<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">1 only<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">2 and 3 only<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">1 and 3 only<\/span><\/li>\r\n\t<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">1, 2 and 3<\/span><\/li>\r\n<\/ol>\r\n<p><b>Answer: (a)<\/b><\/p>\r\n<p><b>Question 2<\/b><span style=\"font-weight: 400\">.\u00a0 Explain the rationale behind the Goods and Services Tax (Compensation to states) act of 2017. How has COVID-19 impacted the GST compensation fund and created new federal tensions?<\/span><b> (UPSC Mains 2020)<\/b><\/p>\r\n<p><b>Question 3.<\/b> <span style=\"font-weight: 400\">Enumerate the indirect taxes which have been subsumed in the goods and services tax (GST) in India. Also, comment on the revenue implications of the GST introduced in India since July 2017. <\/span><b>(UPSC Mains 2017)<\/b><\/p>","protected":false},"excerpt":{"rendered":"<p>GST Council is a constitutional body tasked with overseeing the implementation and administration of the GST in India. Check more GST Council, Constitutional Provisions, Functions.<\/p>\n","protected":false},"author":6,"featured_media":8439,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[30],"tags":[748,40,1033],"class_list":{"0":"post-6066","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-upsc-economy-notes","8":"tag-gst-council","9":"tag-quest","10":"tag-upsc-economy-notes"},"acf":[],"_links":{"self":[{"href":"https:\/\/vajiramandravi.com\/upsc-exam\/wp-json\/wp\/v2\/posts\/6066","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/vajiramandravi.com\/upsc-exam\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/vajiramandravi.com\/upsc-exam\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/upsc-exam\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/upsc-exam\/wp-json\/wp\/v2\/comments?post=6066"}],"version-history":[{"count":1,"href":"https:\/\/vajiramandravi.com\/upsc-exam\/wp-json\/wp\/v2\/posts\/6066\/revisions"}],"predecessor-version":[{"id":18629,"href":"https:\/\/vajiramandravi.com\/upsc-exam\/wp-json\/wp\/v2\/posts\/6066\/revisions\/18629"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/upsc-exam\/wp-json\/wp\/v2\/media\/8439"}],"wp:attachment":[{"href":"https:\/\/vajiramandravi.com\/upsc-exam\/wp-json\/wp\/v2\/media?parent=6066"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/vajiramandravi.com\/upsc-exam\/wp-json\/wp\/v2\/categories?post=6066"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vajiramandravi.com\/upsc-exam\/wp-json\/wp\/v2\/tags?post=6066"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}