GST in India
The GST Council and Cooperative Federalism
The GST Council, with the Union and state finance ministers, decides rates and rules together, and decisions need a large majority.
GST is decided jointly.
Members
The Union Finance Minister chairs the Council, and each state has a representative.
Voting
Decisions need three-fourths of the weighted votes, with the Centre holding one third and states two thirds together.
Why unique
States gave up some taxing power in return for a voice in decisions.
Tension
States sometimes clash with the Centre over rates and compensation.
A rate decision
The Council meets and agrees to change the rate on a group of goods after debate.
Thinking the Centre decides alone
States have a major say.
Key takeaways
- The Council includes Centre and states.
- Decisions need a three-fourths majority.
- States traded power for a voice.
- Disputes can arise.
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