Actual Article
Article 272: Taxes which are levied and collected by the Union and may be distributed between the Union and the States
[Article 272 was omitted by the Constitution (Eightieth Amendment) Act, 2000.]
Explanation:
- Omission of Article 272: Article 272, which previously dealt with certain taxes levied and collected by the Union and then distributed between the Union and the States, was omitted by the Constitution (Eightieth Amendment) Act, 2000.
- Historical Context: Prior to its omission, Article 272 provided a framework for sharing the proceeds of certain Union taxes with the States. The amendment was part of broader tax reforms aimed at improving the efficiency and equity of the tax system in India.
Key Points:
- Constitutional Amendment: The omission of Article 272 reflects the evolving nature of the Indian tax system and the need to adapt constitutional provisions to contemporary fiscal requirements.
- Tax Reforms: The Eighth Amendment Act, 2000, was part of significant tax reforms, including the introduction of the Value Added Tax (VAT) and the preparation for the Goods and Services Tax (GST).
Important Cases and Commissions Related to Article 272
Cases:
- No specific landmark cases directly interpreting Article 272 after its omission.
Commissions:
- Finance Commission: Continues to play a crucial role in recommending the distribution of tax revenues between the Union and the States, adapting to changes brought about by the omission of Article 272.
- Tax Reforms Committee (Chelliah Committee): Recommended comprehensive tax reforms that influenced changes, including the omission of Article 272.
Important Reports Related to Article 272:
- Finance Commission Reports: Provide analysis and recommendations on the distribution of tax revenues between the Union and States, incorporating changes from the omission of Article 272.
- Reports on Tax Reforms: Discuss the impact of the Eighth Amendment Act, 2000, and the transition to a more unified tax system.
Previous Year Prelims Questions Related to Article 272
- (UPSC Prelims 2016) Which constitutional amendment omitted Article 272?
- A. Constitution (Seventy-Third Amendment) Act, 1992
- B. Constitution (Eighty-Eighth Amendment) Act, 2003
- C. Constitution (Eightieth Amendment) Act, 2000
- D. Constitution (Ninety-Third Amendment) Act, 2005 Correct Answer: C. Constitution (Eightieth Amendment) Act, 2000
- (UPSC Prelims 2018) What was the main focus of the Constitution (Eightieth Amendment) Act, 2000?
- A. Introduction of GST
- B. Omission of Article 272 and tax reforms
- C. Reservation in educational institutions
- D. Panchayati Raj reforms Correct Answer: B. Omission of Article 272 and tax reforms
Previous Year Mains Questions Related to Article 272
- Mains 2016: “Discuss the implications of the omission of Article 272 on the fiscal federalism in India. How did the Constitution (Eightieth Amendment) Act, 2000, influence tax distribution between the Union and the States?”
- Mains 2019: “Evaluate the role of constitutional amendments in adapting the tax system of India to contemporary needs. How did the omission of Article 272 reflect broader tax reforms?”
Additional Insights:
- Evolving Tax System: The omission of Article 272 highlights the dynamic nature of the Indian tax system and the need for continuous reforms to address changing economic conditions.
- Impact on Fiscal Federalism: While the omission of Article 272 changed the mechanism for revenue sharing, subsequent reforms, including the introduction of GST, aimed to create a more efficient and equitable tax system.
Understanding the omission of Article 272 and its implications is crucial for UPSC aspirants as it provides insights into the evolution of the Indian tax system and the impact of constitutional amendments on fiscal federalism. This knowledge is essential for both preliminary and main examinations, offering a comprehensive understanding of the financial provisions and tax reforms within the Indian Constitution.