Constitution Section 269A — Levy and collection of goods and services tax in course of inter-State trade or commerce
Part XII — FINANCE, PROPERTY, CONTRACTS AND SUITS — General
Constitutional
Summary
The central government is responsible for collecting the Goods and Services Tax (GST) on supplies that happen between different states. This collected tax is then shared between the central government and the state governments, based on rules set by Parliament after receiving recommendations from the GST Council. For this purpose, importing goods or services into India is also treated as an inter-state supply. The portion of the tax that is given to a state does not go into the central government's main fund, and any tax money used to pay another level of government's GST is also kept separate from those main funds. Parliament can also create laws to decide where a supply is considered to take place and whether it counts as an inter-state transaction.
Official Text
(1) Goods and services tax on supplies in the course of inter-State trade or commerce shall be levied and collected by the Government of India and such tax shall be apportioned between the Union and the States in the manner as may be provided by Parliament by law on the recommendations of the Goods and Services Tax Council.Explanation.—For the purposes of this clause, supply of goods, or of services, or both in the course of import into the territory of India shall be deemed to be supply of goods, or of services, or both in the course of inter-State trade or commerce.
(2) The amount apportioned to a State under clause (1) shall not form part of the Consolidated Fund of India.
(3) Where an amount collected as tax levied under clause (1) has been used for payment of the tax levied by a State under article 246A, such amount shall not form part of the Consolidated Fund of India.
(4) Where an amount collected as tax levied by a State under article 246A has been used for payment of the tax levied under clause (1), such amount shall not form part of the Consolidated Fund of the State.
(5) Parliament may, by law, formulate the principles for determining the place of supply, and when a supply of goods, or of services, or both takes place in the course of inter-State trade or commerce.