fiscal FEDERALISM TAMIL NADU EXPERIENCE WITH GST DIGITAL TAX ADMINISTRATION

Abstract
This article examines fiscal federalism through the lens of Tamil Nadu’s experience with GST implementation
and digital tax administration. As one of India’s most industrialized and revenue-contributing states, Tamil
Nadu’s transition to the unified tax regime highlights both opportunities and tensions inherent in cooperative
federalism. The study analyses revenue trends, compensation mechanisms, and compliance challenges following
GST rollout, with particular focus on the state’s concerns over fiscal autonomy and revenue stability. It also
explores the role of digital platforms such as the Goods and Services Tax Network (GSTN) in enhancing
transparency, efficiency, and data-driven governance. The digitization of tax administration has improved
compliance monitoring and reduced leakages, yet it has simultaneously centralized control and constrained
state-level discretion.By situating Tamil Nadu’s experience within broader debates on fiscal decentralization
and intergovernmental coordination, the article argues that while GST has strengthened tax harmonization, it
has also reshaped the contours of fiscal federalism, necessitating renewed dialogue on revenue sharing,
autonomy, and institutional balance.
Keywords: Fiscal federalism, GST, Tamil Nadu, digital tax administration, cooperative federalism, public
financ