1st Meeting — InauguralSep 22-23, 2016

GST Council Meeting 1 — Historic Constitution & Rules of Procedure

The inaugural GST Council meeting — a historic milestone after 17 years of deliberation. Constituted under Article 279A, chaired by FM Arun Jaitley with 33 members, adopted rules of procedure, established voting framework (Centre 1/3, States 2/3, 3/4 majority), and set an ambitious timeline for India's biggest tax reform.

1st

Meeting Number

Sep 22-23, 2016

Date

2 Days

Duration

New Delhi

Venue

Arun Jaitley

Chairperson

33

Members

279A

Article

3/4 Majority

Voting

Inaugural Meeting — Key Events

Historic Constitution of GST Council

The GST Council was constituted on September 12, 2016 under Article 279A of the Constitution (101st Amendment). First meeting held September 22-23, 2016. Chaired by Union Finance Minister Arun Jaitley with Revenue Secretary as ex-officio Secretary. 31 State/UT Finance Ministers as members. This body has exclusive power to recommend GST rates, exemptions, thresholds, and model laws.

Election of Vice-Chairperson

Council elected its Vice-Chairperson from among State Finance Ministers (rotating). Kerala Finance Minister K.M. Mani was considered but the selection process was discussed. The Vice-Chairperson presides in absence of Chairperson. Voting weight: Centre has 1/3rd, all states together have 2/3rd. Decisions require 3/4th majority of weighted votes — ensuring no single party can dominate.

Rules of Procedure Adopted

Council adopted its Rules of Procedure governing: meeting frequency (at least once per quarter), quorum (half of members), voting procedure (3/4 weighted majority), agenda circulation (15 days before), minutes approval, formation of committees/sub-committees, and confidentiality of proceedings until official press release. These rules ensure orderly functioning of this constitutional body.

Agenda & Work Plan

Council outlined its ambitious work plan: (1) Finalize GST rate structure, (2) Draft CGST, SGST, IGST, Compensation laws, (3) Design IT infrastructure (GSTN), (4) Determine thresholds and exemptions, (5) Resolve Centre-State administrative control, (6) Transition provisions for existing taxpayers. Target: complete all legislation by December 2016, go-live April 1, 2017 (later moved to July 1, 2017).

Constitutional Powers of Council

Article 279A grants GST Council power to make recommendations on: (a) taxes to be subsumed, (b) goods/services exempt from GST, (c) model GST laws and principles, (d) threshold turnover, (e) GST rates including floor rates with bands, (f) special rates during natural calamities, (g) special provisions for certain states, (h) any other GST matter. Recommendations are not legally binding but carry constitutional weight.

Historical Context — 17 Years in Making

GST journey started in 2000 (Vajpayee government, Kelkar Task Force). Key milestones: 2004 — first mentioned in Budget. 2006 — Finance Minister announces April 2010 target. 2011 — Constitution Amendment Bill introduced (115th). 2014 — 122nd Amendment Bill reintroduced. August 2016 — 101st Amendment passed unanimously in both Houses. September 2016 — Council constituted. India's longest tax reform journey.

Meeting 1 — Milestones & Decisions

TopicStatusDetail
GST Council formally constitutedMilestoneUnder Article 279A, 101st Constitutional Amendment
Rules of Procedure adoptedApprovedMeeting frequency, quorum, voting, confidentiality
Vice-Chairperson election processDiscussedRotating among State Finance Ministers
Work plan outlinedAgreedTarget: all laws by Dec 2016, go-live April 2017
Voting weight: Centre 1/3, States 2/3Confirmed3/4 majority required for decisions
Sub-committees authorizedApprovedFitment, Law, IT committees to be formed
Timeline: monthly meetingsAgreedCouncil to meet frequently until GST launch
Consensus-based approachAdoptedAvoid voting, seek unanimous agreement

Frequently Asked Questions

When was the first GST Council meeting held?
The first GST Council meeting was held on September 22-23, 2016 in New Delhi. It was chaired by Union Finance Minister Arun Jaitley. The Council was constituted on September 12, 2016 under Article 279A of the Constitution (inserted by the 101st Amendment, passed in August 2016). This inaugural meeting adopted rules of procedure and outlined the work plan for GST implementation.
What is the GST Council and what are its powers?
The GST Council is a constitutional body created under Article 279A. It consists of Union Finance Minister (Chairperson), Union Minister of State for Finance, and all State/UT Finance Ministers. It recommends: GST rates, exemptions, threshold limits, model laws, and dispute resolution. Voting weight: Centre = 1/3rd, States collectively = 2/3rd. Decisions require 3/4th weighted majority. It's the only federal body in India with such broad taxation powers.
How does voting work in the GST Council?
Voting weight: Centre has 1/3rd (33.33%), all 31 States/UTs collectively have 2/3rd (66.67%). Each state has equal weight within the 2/3rd share. Decisions require 3/4th (75%) of weighted votes cast. This means Centre alone cannot pass anything (has only 33%). States without Centre also cannot (have 67% < 75%). Both must cooperate — ensuring true cooperative federalism. In practice, consensus is preferred over formal voting.
How long did GST take to implement in India?
GST took approximately 17 years from concept to implementation: 2000 — Kelkar Task Force recommends GST. 2004 — First mentioned in Union Budget. 2006 — April 2010 target announced. 2011 — 115th Constitutional Amendment Bill introduced (lapsed). 2014 — 122nd Amendment Bill reintroduced by Modi government. August 8, 2016 — 101st Amendment passed unanimously. July 1, 2017 — GST goes live. The delay was primarily due to Centre-State revenue sharing disputes.
Meeting 2

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