Nine years after its implementation, evaluate the achievements and remaining challenges of GST as a tool for cooperative federalism in India.

Introduced on 1 July 2017 under the Constitution (101st Amendment) Act, 2016, GST pooled the taxing sovereignty of the Union and the States into a shared institution — the GST Council (Article 279A). Nine years on, it has largely succeeded as a machinery of joint fiscal decision-making, though trust deficits and revenue anxieties persist.

Achievements as a federal instrument

• Institutionalised bargaining: The Council, chaired by the Union Finance Minister with all State Finance Ministers as members, decides by a 3/4 weighted majority — Centre holding 1/3 and States 2/3 of votes, so neither side can act alone.
• Consensus on hard reform: The 56th Council (3 Sep 2025) collapsed the four slabs into 5% and 18% plus a 40% sin rate, effective 22 September 2025 — a politically costly rationalisation carried through jointly [3].
• Common national market: Article 269A's IGST mechanism ended the cascading Central Sales Tax and octroi barriers, enabling seamless input tax credit across State borders.
• Shared revenue buoyancy: Collections rose to a record ₹22.08 lakh crore in FY 2024-25 (9.4% growth) [2], with taxpayers expanding from 66.5 lakh to about 1.65 crore by May 2026 [1] — widening the base both governments draw from.

Remaining challenges

• Autonomy loss: States surrendered their principal own-tax handle; with rates set collectively, fiscal flexibility during local shocks is limited.
• Compensation insecurity: The guaranteed 14% growth window ended in 2022, and the borrowing dispute of 2020-22 exposed a genuine trust deficit [5].
• Recommendatory, not binding: In Mohit Minerals (2022) the Supreme Court held Council recommendations bind neither Centre nor States — persuasive for federal balance, but a risk to uniformity.
• Structural gaps: Petroleum, electricity and alcohol remain outside GST, leaving the "one nation, one tax" idea incomplete; dual administration still burdens small taxpayers.

On balance, GST has proved that shared sovereignty can work in India. Deepening it — bringing petroleum products progressively within the net, strengthening the GST Appellate Tribunal, and building a rule-based revenue-assurance mechanism beyond ad-hoc cess — would convert a functioning compromise into mature cooperative federalism, realising the Article 279A vision of a harmonised national market.