Central and State Financial Relations — Policy Reforms

Entry	Year	Description	Impact
101st Amendment	2016	Introduced Goods and Services Tax (GST) by adding Article 246A giving concurrent power to center and states to make laws on GST, Article 269A dealing with GST levied and collected by center but assigned to states, and establishing GST Council under Article 279A. Modified Articles 268, 269, and 270 to accommodate GST structure.	Revolutionized center-state financial relations by creating unified tax system, requiring unprecedented cooperation through GST Council, and establishing new revenue sharing mechanisms with compensation guarantees for states
80th Amendment	2000	Modified Article 269 to include taxes on sale or purchase of goods in inter-state trade or commerce as taxes levied and collected by Union but assigned to states, replacing the earlier system under Article 270.	Simplified center-state tax sharing by directly assigning inter-state trade taxes to states rather than including them in the divisible pool, providing states more predictable revenue from trade within their borders
88th Amendment	2003	Introduced service tax in Article 268A (later repealed by 101st Amendment) as a tax levied by Union but collected and retained by states where services are provided, though this was never implemented as originally envisioned.	Attempted to address the growing importance of service sector in Indian economy by providing states a share in service tax revenues, though implementation challenges led to its eventual replacement by GST