Fiscal Policy Tools — Policy Reforms

Entry	Year	Description	Impact
80th Amendment Act	2000	This amendment gave constitutional backing to the recommendations of the Tenth Finance Commission regarding the alternative scheme of devolution of Union taxes to the States. It replaced the earlier system of sharing only income tax and Union excise duties with a system where a prescribed percentage of the total proceeds of all Union taxes and duties (except cesses and surcharges) would be shared with the States.	Significantly enhanced the financial autonomy and resource base of the States, strengthening fiscal federalism and influencing the overall distribution of fiscal resources across the country. It provided a more predictable and stable source of revenue for states.
88th Amendment Act	2003	This amendment inserted a new Article 268A into the Constitution, providing for 'Taxes on services levied by Union and collected and appropriated by the Union and the States'. It also added Entry 92C to the Union List, enabling the Union to levy taxes on services.	Paved the way for the levy of Service Tax by the Union government, expanding its revenue base. This was a crucial step towards modernizing India's indirect tax regime and eventually integrating it into the Goods and Services Tax (GST) framework.
101st Amendment Act	2016	This landmark amendment introduced the Goods and Services Tax (GST) in India. It inserted new Articles 246A, 269A, and 279A, and amended several existing articles. It empowered both the Parliament and State Legislatures to make laws with respect to GST. Article 279A established the GST Council.	Revolutionized India's indirect tax structure by subsuming multiple central and state taxes into a single, unified tax. It aimed to create a common national market, reduce cascading effects, and improve tax compliance. This was the most significant fiscal reform post-1991, fundamentally altering the taxation toolkit of both the Union and State governments.