Taxation and GST — Quick Revision

A last-week sheet for taxation. Prelims tests articles, entries and exclusions; Mains tests GST and fiscal federalism.

Tax Concepts

Concept	One-liner
Direct tax	Impact and incidence on the same person
Indirect tax	Burden can be shifted to someone else
Progressive / regressive	Rate rises with income / burden heavier on the poor
Ad valorem / specific	Percentage of value / fixed per unit
Buoyancy	Revenue response to GDP, including policy changes
Elasticity	Revenue response to GDP, excluding policy changes
Cess / surcharge	Purpose-specific levy / tax on tax; both Union-only

Article	Provision
246A	Concurrent power to legislate on GST; Parliament alone for inter-State supply
265	No tax except by authority of law
268	Stamp duties: levied by Union, collected and kept by States
269	Inter-State sale taxes (non-GST): levied by Union, assigned to States
269A	IGST on inter-State supply and imports
270	Divisible pool of Union taxes (including CGST), shared per Finance Commission
271	Surcharges for the Union
279A	GST Council
366(12A)	Definition of GST; excludes alcohol for human consumption

Union List	State List
82: income tax (non-agricultural)	46: agricultural income tax
83: customs	49: lands and buildings
84: excise on five petroleum products and tobacco	51: excise on alcohol for human consumption
85: corporation tax	54: sales tax on five petroleum products and alcohol

Item	Fact
Amendment	101st (2016)
Launch	1 July 2017
Type	Dual, destination-based consumption tax with input tax credit
Components	CGST, SGST / UTGST, IGST
Council chair	Union Finance Minister
Voting	Three-fourths weighted majority; Centre one-third, States two-thirds; quorum one-half
Binding?	No: Mohit Minerals (May 2022)
Compensation	14% growth over 2015-16 for five years (to 30 June 2022), via compensation cess
Outside GST	Alcohol for human consumption; five petroleum products (until Council recommends); electricity; stamp duty; basic customs duty

High-yield facts

Kelkar Task Force (2004) first proposed a comprehensive GST.
80th Amendment (2000) made all central taxes shareable (except cesses and surcharges).
15th Finance Commission: 41% of the divisible pool to States (2021-26). 16th Finance Commission (Arvind Panagariya) covers 2026-31.
Corporate tax (2019): 22% base rate (no exemptions); 15% for new manufacturing companies.
GAAR in force from 1 April 2017. Wealth tax abolished from 2015-16.
CBDT and CBIC: Central Boards of Revenue Act, 1963.