Article 286

Part XII — Finance, Property, Contracts and Suits · Constitution of India

Article 286

Restrictions as to imposition of tax on the sale or purchase of goods. (1) No law of a State shall impose, or authorise the imposition of, a tax on the supply of goods or of services or both, where such supply takes place— (a) outside the State; or (b) in the course of the import of the 3goods or services or both into, or export of the goods or services or bothout of, the territory of India. (2) Parliament may by law formulate principles for determining when a supply of goods or of services or both in any of the ways mentioned in clause (1).

In plain wordsA state cannot tax the supply of goods or services that happens outside its borders or during import into or export out of India. This stops two states from both taxing the same purchase, and Parliament sets the rules for deciding where a sale happens.

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