Category Archives: Federalism

On Monday, Canada hit a dark milestone of over 20,000 deaths from COVID-19. One reason for this disturbing statistic is the intergovernmental finger-pointing 10 months into the pandemic; the ability of Canadian federalism to meet this national crisis continues to be tested.

Theres a sharp contrast between Canada and Australia, also a federal state, in how each country has managed the pandemic. Australia crushed the curve, while Canadas approach has been much less successful. Canadians are justified in asking why.

Despite the challenges of heading a coalition government, Australias Liberal prime minister has navigated the rocky shoals between federal and state governments to implement significant measures including lockdowns affecting businesses, minority groups, and those less advantaged. In contrast, Canadas federal-provincial coordination has been mixed, which may have resulted in higher rates of infection and death than in Australia.

A Canadian consensus to act decisively and co-operatively was evident earlier in the pandemic. Last March, premiers were unanimous in their support of lockdowns. They also publicly supported their public health officials, and mobilized health ministries and procurement authorities. Together, the latter snapped into action, acquiring and distributing personal protective equipment, collaborating, and sharing public-health guidance across jurisdictions. Fluid and dynamic conversations were had at a dizzying and productive pace among leaders from all orders of government in the federation: local, provincial/territorial, federal, and Indigenous. Indigenous governments and leaders managed to attract billions of federal dollars, and to get support from the Canadian Armed Forces. Federalism in Canada was indeed working.

However, by summers end, such informal co-operation between governments began to fray. Canadas Constitution provides few formal mechanisms for national coordination. The Peace, Order and Good Government clause in section 91 of the Constitution Act has been interpreted as giving the federal government emergency powers, but its use is controversial. The federal Emergencies Act would seem tailor-made for this situation (a public-welfare emergency being one of four kinds contemplated by the Act), but the Act requires consultation with the provinces. Provinces were unanimous in opposing its invocation as an intrusion in an area squarely within their jurisdiction under the Constitution Act.

Throughout the fall, COVID infections multiplied. At a meeting of first ministers in December, Ottawa briefed them on its vaccine plans, and shared data on national and regional trends. The provinces and territories decided to use their collective voice to ask Ottawa for more health-transfer money. Meanwhile, Australia was locking down again.

That meeting may be remembered as a low point for Canadian federalism. Clearly, an opportunity for the federation to serve Canadians was missed. Was that really the time for provinces and territories to argue for perennial increases in health-care transfers?

Instead, they could have forged a joint plan of action, with coordinated lockdowns, travel restrictions, and bans timed according to vaccine distribution. Australia has shown that, with vaccines in sight, a hard shutdown to crush the curve is not only tolerable, but popular. Canada got its first shipment of vaccine 10 days after that December meeting.

According to a recent Angus Reid Poll, 51 per cent of Canadians say the No. 1 problem the federal government should be dealing with right now is the pandemic. Thats the highest proportion saying so since the pandemic began. Health care is second on the priority list, at 38 per cent, and the economy is third, at 29 per cent.

In the collective best interest of Canadians, maybe premiers could agree to a coordinated 90-day lockdown (excepting schools). Imagine what the federation could achieve: stabilize vaccine supply and distribution; relieve pressure on hospitals intensive-care units; bend the curve; and limit the spread of the virus and its variants.

After 90 days, the federation could be as effective and strong as Australias.

Stephen Van Dine is the senior vice-president at the Institute on Governance.

The views, opinions and positions expressed by all iPolitics columnists and contributors are the authors alone. They do not inherently or expressly reflect the views, opinions and/or positions of iPolitics.

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A tale of two federations and their (mis)handling of the pandemic - iPolitics.ca

Since Ethiopian Prime Minister Abiy Ahmed assumed office in April 2018, experts have optimistically predicted the countrys emergence as a regional power. Factors such as a large population, rapid economic growth, and a reform-minded head of government seemed to support this proposition, until recent instability in federal relations threatened an upset to Ethiopias position as an emerging power.

After the federal governments recent incursion into the Tigray region of Ethiopia and subsequent fighting, reports suggest that several thousand citizens are dead and upwards of 40,000 are displaced. The conflict has drawn attention from the African Union and various other international actors. The crisis in Tigray is not an isolated event, but a manifestation of the security threats and political instability plaguing Prime Minister Ahmed Abiy in his campaign for national unity. Should Addis Ababa fail to resolve Ethiopias underlying grievances, Ethiopia risks losing both its position as a regional power and its cache as an international partner.

Violence in Tigray commenced in early November 2020 when Abiy ordered federal troops into the region. While the invasion was ostensibly a reaction to looting by the Tigray Peoples Liberation Front (TPLF), most observers agree that the military action was intended as punishment after regional leaders held elections last September in defiance of a federal ban. Abiy declared victory on November 28th after federal troops took control of Tigrays capital, Mekelle. However, fighting in the region remains heavy. International observers have also raised concerns of war crimes after Ethiopian armed forces threatened to target civilians.

At the heart of this contest between Abiy and the TPLF is a debate around Ethiopian governance and the extent to which Addis Ababa should exercise centralized control. The Tigray conflict has highlighted Ethiopias unique system of ethnic federalism, which gives semi-autonomous power to the countrys states, each of which was created along ethnic lines. Since this system was first implemented in 1995, certain ethnic groups notably the Tigray have enjoyed a degree of political control disproportionate to their demographic representation.

Abiys 2018 election marked a challenge to Ethiopias status quo. As the countrys first Oromo prime minister, an ethnic group which is demographically dominant but historically marginalized, Abiy has prioritized the blurring of ethnic lines. His program of Ethiopianization envisions a unified national identity that would take precedence over ethnic divisions. But after enjoying 15 years of special advantages achieved through their political clout, powerful ethnic groups fear losing their superior position to homogeneity. The resulting discontent has destabilized Ethiopian governance, as regional leaders fight to maintain their power and autonomy while Abiy tries to solidify central control.

The degree of violence seen in Tigray and the seeming intransigence on both sides of the federalism debate has led some analysts to warn of a broader civil war in Ethiopia. These fears are likely overblown. Two months of intense conflict in Tigray have strained TPLF resistance, and no other state in Ethiopia has the economic or military assets to successfully launch a revolt at this scale. However, it is clear that tensions between Addis Ababa and powerful regional contingents are not going away.

Although it received the most press coverage, what happened in Tigray is not an isolated event. Amharas attempted regional coup and the Sidama regions vote for autonomy from the Southern Nationalities, Nations, and Peoples Region, both in 2019, represented earlier challenges to Abiys anti-federalist agenda. Nationwide, escalating violence from ethnic paramilitary groups has also threatened Ethiopianization. In the face of continuing resistance, Abiy must be prepared to use force to retain control over the country. Tigray demonstrated his military willingness towards this end, and recent purges of opponents from top positions have shorn up his political might. Abiy should also realize that ruling under martial law may seriously jeopardize Ethiopias position as a regional leader and international power.

Ethiopia has some natural advantages that set it up as a regional power, including its size and resource wealth. But the countrys leadership has also sought out an expanded role in recent years: Addis Ababa hosts the African Union headquarters; the countrys National Defense Force coordinates and oversees multilateral peace and security operations in the region; and Ethiopian heads of government have mediated conflicts among neighboring states. Today, as Kenyan-Somali ties disintegrate and the U.S. withdrawal from Somalia generates ill-will in the region, strong leadership over the Horn of Africa is more important than ever.

The Tigray situation is already having harmful effects on regional relations. Federal troops came into direct conflict with Ethiopias western neighbor after patrol operations ambushed Sudanese forces. The burdens that come with mass refugee flows also threaten regional ties, as Tigrayan civilians surge over the border into Sudan and Eritrea. Perhaps the most serious consequence for Ethiopias position in East Africa, however, are the indirect effects of Abiys battle for centralized control. The guarded militarism inherent in this fight against state autonomy does not lend itself to legitimate leadership, raising the potential for increased distance from neighbors and regional institutions.

Of even greater concern to world leaders is the risk that an Ethiopian implosion could disrupt international security operations in the Horn of Africa. Prime Minister Abiy and his predecessors have operated in close partnership to American and European powers in counterterrorism and anti-piracy initiatives. With terrorist capabilities surging in the region and piracy ramping up off the coast of Somalia, international actors depend on capable, stable partners like Ethiopia. Unless Abiy finds a peaceful and sustainable solution to conflict over federalist governance, Ethiopia will lose its position as that go-to ally.

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Conflict in Tigray: Implications for Ethiopia's International Standing - Charged Affairs

Overview

Federalism is a system of government in which the same territory is controlled by two levels of government. Generally, an overarching national government is responsible for broader governance of larger territorial areas, while the smaller subdivisions, states, and citiesgovern the issues of local concern.

Both the national government and the smaller political subdivisions have the power to make laws and both have a certain level of autonomy from each other.

In the United States, the Constitution has established a system of dual sovereignty, under which the States have surrendered many of their powers to the Federal Government, but also retained somesovereignty.Examples of this dual sovereignty are described in the U.S. Constitution.

Article VI of the U.S. Constitution contains the Supremacy Clause, which reads,"This Constitution, and the laws of the United States which shall be made in pursuance thereof; and all treaties made, or which shall be made, under the authority of the United States, shall be the supreme law of the land; and the judges in every state shall be bound thereby, anything in the Constitution or laws of any State to the contrary notwithstanding." This effectively means that when the laws of the federal government are in conflict with the laws of a state's government, the federal law will supersede the state law.

Article I, Section 8 of the Constitution describes specific powers which belong to the federal government. These powers are referred to as enumerated powers.

The Tenth Amendmentreserves powers to the states, as long as those powers are not delegated to the federal government. Among other powers, this includes creating school systems, overseeing state courts, creating public safety systems, managing business and trade within the state, and managing local government. These powers are referred to as reserved powers.

Concurrent powers refers to powers which are shared by both the federal government and state governments. This includes the power to tax, build roads, and create lower courts.

For more on federalism, see this Florida State University Law Review article, this Vanderbilt Law Review article, and thisStanford Law Review article.

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Federalism | Wex | US Law | LII / Legal Information Institute

Federalism is one of the most important and innovative concepts in the U.S. Constitution, although the word never appears there. Federalism is the sharing of power between national and state governments. In America, the states existed first, and they struggled to create a national government. The U.S. Constitution is hardwired with the tensions of that struggle, and Americans still debate the proper role of the national government versus the states. Chief Justice John Marshall, the longest-serving leader of the Supreme Court, noted that this question is perpetually arising, and will probably continue to arise, as long as our system shall exist.

E Pluribus Unum: out of many states, one nation. In 1776, the newly independent states acted like 13 quarreling brothers and sisters. These united states had vast differences in history, geography, population, economy, and politics. Each state wanted all the powers of sovereign nations: to make treaties, receive ambassadors, coin money, regulate commerce. But they had to give up some of those powers in order to survive on the world stage. To that end, they agreed to the Articles of Confederation, the first constitution of the United States. It created a firm league of friendship among the states, along with a legislature of very limited powers. Congress was very weak: it could wage war and negotiate peace, but not raise taxes to pay for either. Each state had one vote in Congress, and any changes to the Articles required unanimous consent.

After the war ended in 1783, strains in the union reemerged, and the country was in danger of falling apart. The states could not agree on how to pay Revolutionary War soldiers, and many veterans returned home to farms saddled with debt and taxes. In 1786-87, as part of an uprising known as Shays' Rebellion, farmers in western Massachusetts closed the courts to prevent foreclosure on their farms. Also, the states themselves were not inclined to obey the peace treaty they had just signed with Great Britain. As George Washington noted in 1786: If you tell the Legislatures they have violated the treaty of peace and invaded the prerogatives of the confederacy they will laugh in your face. He added: What a triumph for the advocates of despotism to find that we are incapable of governing ourselves.

Faced with the very real problems of a weak central government, Congress issued a resolution in February 1787 calling for a convention to amend the Articles of Confederation. But at the Philadelphia convention, which opened on May 25, 1787, delegates quickly began to consider an entirely new form of government, federalism, which shared power between the states and a more robust central government with truly national powers.

After four months, the delegates drastically changed the relationship among the states and created a new national government, abandoning the Articles of Confederation. This new government had executive and judicial powers, along with expanded legislative authority. Unlike the Confederation, states in the new legislature would not be represented equally. Instead, big states with large populations exercised more power in Congress. Slaveholding states were allowed to count three-fifths of their enslaved population for representation and taxation purposes. To count slaves fully would only have increased the political power of slave states.

On September 17, 1787, the delegates approved and signed an entirely new Constitution for the United States of America. Once approved by the people, the Constitution's federal system would create a unique solution to sharing power among the states and the national government. Even George Washington admitted that the Constitution was not perfect, but rather--in the words of its Preamble--the next step in a more perfect union.

Federalism content written by Linda R.Monk, Constitutional scholar

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Federalism | Constitution USA | PBS

Division of powers between national, state, tribal and local governments

Federalism in the United States is the constitutional division of power between U.S. state governments and the federal government of the United States. Since the founding of the country, and particularly with the end of the American Civil War, power shifted away from the states and toward the national government. The progression of federalism includes dual, cooperative, and new federalism.

Federalism is a form of political organization that seeks to distinguish states and unites them, which assigns different types of decision-making power at different levels to allow a degree of political independence in an overarching structure.[1] Federalism was a political solution for the problems with the Articles of Confederation which gave little practical authority to the federal government. For example, the Articles allowed the Continental Congress the power to sign treaties and declare war, but it could not raise taxes to pay for an army and all major decisions required a unanimous vote.[2]

The movement for federalism was greatly strengthened by the reaction to Shays' Rebellion of 17861787, which was an armed uprising of yeoman farmers in western Massachusetts. The rebellion was fueled by a poor economy that was created, in part, by the inability of the federal government to deal effectively with the debt from the American Revolutionary War. Moreover, the federal government had proven incapable of raising an army to quell the rebellion, so that Massachusetts had been forced to raise its own.[3][4]

On May 15th, 1787, fifty-five delegates met at what would be known as the Constitutional Convention in the Philadelphia State House. There, the delegates debated the structure, provisions, and limitations of Federalism in what would be the Constitution of the United States. This was a clear development in federal thought.[1]

Preceding examples, such as in the Virginia Declaration of Rights, influenced the delegates whilst framing their ideas of Federal bicameral legislature (United States Congress), balanced representation of small and large states (Great Compromise), and checks and balances structures[5]James Madison stated in a pre-convention memorandum to the delegates that because "one could hardly expect the state legislatures to take enlightened views on national affairs", a stronger central government was necessary.[6]

Madison later wrote in Federalist No. 10 on his support for a federal government, "the smaller the number of individuals composing a majority, and the smaller the compass within which they are placed, the more easily will they concert and execute their plans of oppression. Extend the sphere, and you take in a greater variety of parties and interests; you make it less probable that a majority of the whole will have a common motive to invade the rights of other citizens".[7]

The convention had begun altering its original plan but then decided to abandon continued efforts of emendation, and officially set about constructing a new Constitution of the United States. Because George Washington lent his prestige to the Constitution and because of the ingenuity and organizational skills of its proponents, the Constitution was ratified in all states. The outgoing Congress of the Confederation scheduled elections for the new government, and set March 4, 1789 as the date that the new government would take power. Once the convention concluded and released the Constitution for public consumption, the Federalist and Anti-Federalist movements soon began publicizing their disagreeing beliefs in local newspapers and segments.[8]

The most forceful defense of the new Constitution was The Federalist Papers, a compilation of 85 anonymous essays published in New York City to convince the people of the state to vote for ratification. These articles, written by Alexander Hamilton and James Madison, with some contributed by John Jay, examined the benefits of the new, proposed Constitution, and analyzed the political theory and function behind the various articles of the Constitution. The Federalist Papers remain one of the most important sets of documents in American history and political science.[9]

Those opposed to the new Constitution became known as the Anti-Federalists. They generally were local rather than cosmopolitan in perspective, oriented to plantations and farms rather than commerce or finance, and wanted strong state governments and a weak national government. According to political scientist James Wilson, the Antifederalists "were much more committed to strong states and a weak national government....A strong national government, they felt, would be distant from the people and would use its powers to annihilate or absorb the functions that properly belonged to the states."[10]

The Anti-Federalist critique soon centered on the absence of a bill of rights, which Federalists in the ratifying conventions promised to provide. Washington and Madison had personally pledged to consider amendments, realizing that they would be necessary to reduce pressure for a second constitutional convention that might drastically alter and weaken the new federal government. Madison proposed amendments that gave more rights to individuals than to states, which led to criticisms of diversion by Anti-Federalists.[11]

In 1789, Congress submitted twelve articles of amendment to the states. Ten of these articles, written by congressional committees, achieved passage on December 15, 1791 and became the United States Bill of Rights.[11] The Tenth Amendment set the guidelines for federalism in the United States.[12]

After the first federalist movement achieved its aims in promoting the Constitution, an official Federalist Party emerged with slightly different aims. This one was based on the policies of Alexander Hamilton and his allies for a stronger national government, a loose construction of the Constitution, and a mercantile (rather than agricultural) economy. As time progressed, the factions which adhered to these policies organized themselves into the nation's first political party, the Federalist Party, and the movement's focus and fortunes began to track those of the party it spawned.

While the Federalist movement of the 1780s and the Federalist Party were distinct entities, they were related in more than just a common name. The Jeffersonian or Democratic-Republican Party, the opposition to the Federalist Party, emphasized the fear that a strong national government was a threat to the liberties of the people. They stressed that the national debt created by the new government would bankrupt the country, and that federal bondholders were paid through taxes collected from honest farmers and workingmen. These themes resonated with the Anti-Federalists, the opposition to the Federalist movement of the 1780s. As Norman Risjord has documented for Virginia, of the supporters of the Constitution in 1788, 69% joined the Federalist party, while nearly all (94%) of the opponents joined the Republicans. 71% of Thomas Jefferson's supporters in Virginia were former anti-federalists who continued to fear centralized government, while only 29% had been proponents of the Constitution a few years before. In short, nearly all of the opponents of the Federalist movement became opponents of the Federalist Party.[citation needed] However, James Madison, who was one of the strongest proponents of the Constitution and a member of the first federalist movement, became a Jeffersonian.[13]

The movement reached its zenith with the election of John Adams, an overtly Federalist President. However, with the defeat of Adams in the election of 1800 and the death of Hamilton, the Federalist Party began a long decline from which it never recovered. What finally finished off the Federalist party was the Hartford Convention of 1814, in which five New England states gathered to discuss several constitutional amendments necessary to protect New England's interests in regard to the blockade of their ports by the British during the War of 1812. The threat of secession also was proposed during these secret meetings. Three delegates were sent to Washington, DC to negotiate New England's terms only to discover the signing of the Treaty of Ghent, ending the war with the British.[14] Across the nation, Republicans used the great victory at New Orleans to ridicule the Federalists as cowards or defeatists. The Federalists were thereafter associated with the disloyalty and parochialism of the Hartford Convention and destroyed as a political force.[15]

The United States Supreme Court under Chief Justice John Marshall played an important role in defining the power of the federal and state governments during the early 19th century. As the U.S. Constitution does not specifically define many dividing lines between the layers of government, the Supreme Court settled the issue in New York. The question was answered particularly in the cases, McCulloch v. Maryland, in which the court unanimously found that the states could not tax a federal institution that was deemed legitimate and appropriate, Gibbons v. Ogden, in which Congress was confirmed control of interstate commerce under the commerce clause instead of the states, and Marbury v. Madison which broadly expanded the power of the national government.[16][17] A notable instance in which the Marshall Court empowered the states under federalism was in that of Barron v. Baltimore, a case which resulted in Marshalls court unanimously concluding that the 5th amendment only applied to the federal government and not the states.[18]

Despite Chief Justice Marshall's strong push for the federal government, the court of his successor, Roger B. Taney (18351864), decided cases that favored equally strong national and state governments. The basic philosophy during this time was that the U.S. Government ought to be limited to its enumerated powers and that all others belonged to the states. Any powers that were not granted to the U. S. Government by the Constitution were handed over to the states through the Tenth Amendment. Relevant court cases Dual federalism had a significant impact on social issues in the United States. Dred Scott v. Sanford was an example of how Taney's dual federalism helped stir up tensions eventually leading to the outbreak of the Civil War. Another example of dual federalism's social impact was in the Plessy v. Ferguson ruling. Dual federalism had set up that the U.S. Government could not legislate on moral issues. It was an issue that had to be decided by the states, and thus "separate but equal" could exist. Lastly, near the end of dual federalism's lifespan, both the Sixteenth and the Seventeenth Amendment bolstered the power of the national government, and divided state and federal power( Fuad Nor, 1977).

The ratification of the Fourteenth Amendment in 1868 marked a significant transfer of authority from state governments to the federal government, declaring United States citizenship paramount to state citizenship. Over time, the application of the Fourteenth Amendment and incorporation of the Bill of Rights to the states strengthened the federal governments power to protect against state intrusions upon individual rights.[19] The 14th Amendment ensured the shielding of fundamental rights of the individual citizen against the threats presented by rights of the state by the Privileges or Immunities Clause.[20]

Still, in the immediate aftermath of the Taney court and the rise of Dual federalism, the division of labor between federal, state, and local governments was relatively unchanged for over a century. Political scientist Theodore J. Lowi summarized the system in place during those years in The End of the Republican Era[21]

This lack of change is nowhere more apparent than in Supreme Court rulings that addressed federalism against the backdrop of the laissez-faire, pro-business Gilded Age. In United States v. E.C. Knight Co. (1895), the Supreme Court continued along the path of promoting dual federalism in striking down a provision of the Sherman Antitrust Act. In an 8-1 decision, the Court ruled that Congress lacked the authority under the Commerce Clause to regulate monopolies by adopting a limited interpretation of interstate commerce, a win for states rights. In 1918, a 5-4 majority ruled similarly in Hammer v. Dagenhart, a challenge against the constitutionality of the Federal Child Labor Act of 1915. However, by 1941, this ruling was reversed in United States v. Darby Lumber Company. The Court delivered another victory for dual federalism in Coyle v. Smith (1911), where Oklahomas effort to relocate their capital to Oklahoma City was halted. The state agreed to keep the capital in Guthrie until at least 1913 as part of the terms of their Enabling Act of 1906, which outlined the conditions for Oklahomas acceptance into the Union as a state. These cases illustrate the Supreme Courts consistent willingness to rule in favor of states rights until National Labor Relations Board v. Jones & Laughlin Steel Corporation (1937), which ushered in a new era of cooperative federalism for the courts.[22]

Despite the Supreme Courts stubbornness on guarding states rights, much of the modern federal apparatus owes its origins to changes that occurred during the period between 1861 and 1933. While banks had long been incorporated and regulated by the states, the National Bank Acts of 1863 and 1864 saw Congress establish a network of national banks that had their reserve requirements set by officials in Washington. During World War I, a system of federal banks devoted to aiding farmers was established, and a network of federal banks designed to promote home ownership came into existence in the last year of Herbert Hoover's administration. Congress used its power over interstate commerce to regulate the rates of interstate (and eventually intrastate) railroads and even regulated their stock issues and labor relations, going so far as to enact a law regulating pay rates for railroad workers on the eve of World War I. During the 1920s, Congress enacted laws bestowing collective bargaining rights on employees of interstate railroads and some observers dared to predict it would eventually bestow collective bargaining rights on persons working in all industries. Congress also used the commerce power to enact morals legislation, such as the Mann Act of 1907 barring the transfer of women across state lines for immoral purposes, even as the commerce power remained limited to interstate transportationit did not extend to what were viewed as intrastate activities such as manufacturing and mining.

As early as 1913, there was talk of regulating stock exchanges, and the Capital Issues Committee formed to control access to credit during World War I recommended federal regulation of all stock issues and exchanges shortly before it ceased operating in 1921. With the Morrill Land-Grant Acts Congress used land sale revenues to make grants to the states for colleges during the Civil War on the theory that land sale revenues could be devoted to subjects beyond those listed in Article I, Section 8 of the Constitution. On several occasions during the 1880s, one house of Congress or the other passed bills providing land sale revenues to the states for the purpose of aiding primary schools. During the first years of twentieth century, the endeavors funded with federal grants multiplied, and Congress began using general revenues to fund themthus utilizing the general welfare clause's broad spending power, even though it had been discredited for almost a century (Hamilton's view that a broad spending power could be derived from the clause had been all but abandoned by 1840).

During Herbert Hoover's administration, grants went to the states for the purpose of funding poor relief. The 1920s saw Washington expand its role in domestic law enforcement. Disaster relief for areas affected by floods or crop failures dated from 1874, and these appropriations began to multiply during the administration of Woodrow Wilson (191321). By 1933, the precedents necessary for the federal government to exercise broad regulatory power over all economic activity and spend for any purpose it saw fit were almost all in place. Virtually all that remained was for the will to be mustered in Congress and for the Supreme Court to acquiesce.[23]

Cooperative Federalism involves a looser interpretation of the Tenth Amendment. More specifically, it supports the idea that the Tenth Amendment does not provide any additional powers to the states.[25] It operates under the assumption that the federal and state governments are "partners," with the federal creating laws for the states to carry out. It relies on the Supremacy Clause and the Necessary and Proper Clause as constitutional bases for its argument. Court cases such as United States v. Darby Lumber Co. and Garcia v. San Antonio Metropolitan Transit Authority expanded the role of Cooperative Federalism by forcing states to enforce federal labor laws.

Although Cooperative Federalism has roots in the civil war, the Great Depression marked an abrupt end to Dual Federalism and a dramatic shift to a strong national government. President Franklin D. Roosevelt's New Deal policies reached into the lives of U.S. citizens like no other federal measure had. As the Supreme Court had rejected nearly all of Roosevelt's economic proposals, the president proposed the Judicial Procedures Reform Bill of 1937 to add more members. The expansion of the Court, which never materialized, along with a Democrat-controlled Congress would tilt Court rulings in favor of Roosevelt's policies.[26] Lowi notes three Supreme Court cases that validated the shift in power:[27]

The national government was forced to cooperate with all levels of government to implement the New Deal policies; local government earned an equal standing with the other layers, as the federal government relied on political machines at a city level to bypass state legislatures. The formerly distinct division of responsibilities between state and national government had been described as a "layer cake," but, with the lines of duty blurred, cooperative federalism was likened to a "marble cake" or a "picket fence." In cooperative federalism, federal funds are distributed through grants in aid or categorical grants which gave the federal government more control over the use of the money.

Another movement calling itself "New Federalism" appeared in the late 20th century and early 21st century. New Federalism, which is characterized by a gradual return of power to the states, was initiated by President Ronald Reagan (198189) with his "devolution revolution" in the early 1980s and lasted until 2001. Previously, the federal government had granted money to the states categorically, limiting the states to use this funding for specific programs. Reagan's administration, however, introduced a practice of giving block grants, freeing state governments to spend the money at their own discretion. An example and the first case of this was Garcia v. San Antonio Metropolitan Transit Authority (SAMTA) (1985). Garcia was a worker for SAMTA and appealed that because SAMTA received federal money, that they had to abide by federal labor regulations. SAMTA argued that they did not because the money received was to be used at their own discretion and did not need to abide by federal statutes because they are locally operated and make decisions about the transit system. This gave more autonomy and power to the states by allowing them to use more discretion, not having to abide by federal regulations.

Under New Federalism, the question that is asked is may the federal government constitutionally command the states to carry out federal policy? For this, the courts use the anti-commandeering principle. "The anti-commandeering doctrine says that the federal government cannot require states or state officials to adopt or enforce federal law." This became the principle by New York v. United States (1992). In this case, New York sued the federal government, questioning the authority of congress to regulate waste management. The courts ruled that it violated the 10th amendment because congress made the state of New York commandeer to federal regulations when states already take legal ownership and liability for waste treatment. Establishing this principle, giving states more autonomy on issues that fall under their discretion.

A modern-day application of this rule can be found in Murphy v. National Collegiate Athletic Association (2018). New Jerseys governor attacked the federal government's prohibition on sports gambling. The courts again used the anti-commandeering principle, allowing states to regulate sports gambling at their discretion. This is starting to become a trend because now states are passing laws on issues that are often federally prohibited or heavily regulated by Congress under the commerce clause, as in the areas of medical marijuana (Gonzales v. Raich), partial-birth abortion (Gonzales v. Carhart), gun possession (United States v. Lopez), federal police powers (United States v. Morrison, which struck down portions of the Violence Against Women Act), or agriculture (Wickard v. Filburn).

The balance between state and federal power has fluctuated in the 21st century. The federal government increased its power under the presidency of Barack Obama (20092017). Obama took office following the 2008 financial crash, which called for him to take action to ensure that the economy wouldn't collapse. He subsequently introduced The American Recovery and Reinvestment Act 2009 (ARRA).[28] This act placed a government focus on providing financial bailouts and ensuring jobs were secure. Even though usually the federal government provides funding, and states decide how to distribute it. Additionally, federalism today has been debated under Obama with the introduction of the Affordable Care Act, the act sought to increase access to health insurance to an additional 32 million citizens. Many argued that this was an infringement on the power of the federal government, as they should not dictate what private businesses do. [29]

Federalism under Donald Trump was more complicated. In 2020, the executive branch of the federal government failed to act during the coronavirus pandemic, despite the federal government traditionally dealing with matters of national importance, including natural disasters or virus outbreaks.[30] This would suggest that Trump attempted to weaken the role of the federal government, although he also attempted to override state powers or exercise powers that the Constitution did not grant the presidency.[31][32] Punitive federalism, or the punishment of states and local areas by the federal government, became an issue during the Trump administration.[32] Another issue was Trump's response to the Black Lives Matter protests, in which he took a more confrontational stance, including deploying federal troops and agents to protests, despite several states opposing this measure and the action being condemned for possible unconstitutionality.[33][34] According to Thompson, Wong, and Rabe, "Trump [was] particularly aggressive in the use of executive power, or the 'administrative presidency', to pursue his goals, including executive orders and regulatory changes." However, "the forces of federalism, especially state attorneys general, governors, and legislatures, have often undercut Trumps executive initiatives and reduced their impact".[35]

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Federalism in the United States - Wikipedia

The Drone Service Providers Alliance (DSPA) warns that drone federalism the idea that states and local government should share control of the airspace could be added to the budget bill under discussion in Congress today. The group is calling on the industry to contact their representatives about the issue.

Republic Senator Mike Lee of Utah introduced a Drone Integration and Zoning Act in 2019 that would have designated all airspace under 200 feet under the jurisdiction of state law. This proposal, which didnt make it out of the Senate and was widely criticized, followed a proposal by Democratic Senator Dianne Feinstein of California, known as the Drone Federalism Act. Feinsteins proposal would also have granted states sweeping powers over the airspace.

Now, says the DSPA, Lee appears to be attempting to add a drone federalism segment to the Budget Bill before voting.

Why Drone Federalism is an Issue

These proposals could cause problems for the drone industry, and for the FAA. The FAA claims pre-emption, which means that they regulate all of the airspace in the United States. Thats all of the airspace, down to the ground. Thats a problematic concept for some homeowners, especially in the age of drones: and as its an issue without clear precedent, its one that is likely to be debated for many years to come.

While the FAA has tried through the UAS Integration Pilot Project (IPP) and its next phase, the BEYOND program, to bring state and local governments into the decision-making process, the issue of whether states should be allowed to regulate drones remains. If states are able to gain control over some of the airspace, that could result in a patchwork quilt of drone regulations across the United States and open the door to different fee structures or taxation for use of the airspace.

Drones have become a new battleground issue for politicians from security and privacy fears to private property rights. Its up to the drone industry to educate lawmakers on the issues and potential unforeseen consequences of any regulation being considered.

Miriam McNabb is the Editor-in-Chief of DRONELIFE and CEO of JobForDrones, a professional drone services marketplace, and a fascinated observer of the emerging drone industry and the regulatory environment for drones. Miriam has penned over 3,000 articles focused on the commercial drone space and is an international speaker and recognized figure in the industry. Miriam has a degree from the University of Chicago and over 20 years of experience in high tech sales and marketing for new technologies.For drone industry consulting or writing,Email Miriam.

TWITTER:@spaldingbarker

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Drone Federalism Bil Could Be Added to Budget Bill - DRONELIFE - DroneLife

NewsOpinionColumnistsThe people of Scotland will be given their voice. A referendum on independence will come.

Tuesday, 2nd February 2021, 7:00 am

However, First Minister Nicola Sturgeon has confirmed that this will only happen once the health emergency is over.

She also committed to holding a legal referendum, likely requiring agreement with Westminster. Given the present position of the Prime Minister on the issue, achieving such agreement may also take some time.

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A gap of at least a year, or more likely two years, between the May elections and a referendum would in any event be useful.

A referendum squeezes a complex and complicated issue into a simple, binary choice: Yes or no to independence. But what is missing thus far is the other side of the equation. What would the alternative to independence be?

A scramble for solutions

The Westminster parties have only just started the process of articulating their answer. The Cabinet Office under Michael Gove is said to have begun studying alternatives. Labour under Sir Keir Starmer has commissioned noted Scot and former Prime Minister Gordon Brown to head a broad consultation on future constitutional arrangements in the UK.

Already some years back, several members of parliament formed a Constitutional Reform Group. This sustained work has resulted in a Private Members Bill on an Act of Union that has had its first reading in the Lords. More recently, a Commons committee on constitutional issues was announced in the Queens speech, although its remit remains unexplained.

It is not clear how these diverse ventures will yield one single, firm proposal that could be offered as an alternative to independence. Then again, most efforts are led by outspoken unionists. Will they really put forward what best meets the needs of the people of Scotland, or will the exercise be seen as a scheme to blunt the momentum towards independence?

Michael Gove and Sir Keir Starmer have indicated that they are willing to consider significant constitutional change in order to tempt Scotland away from independence. In reality, they seem to be merely heading for further devolution. However, the previous promise of devo-max, made in the so-called Pledge of the principal unionist political parties just days before the 2014 Scotland referendum, has devalued that approach.

Few people in Scotland have experienced significant change after 2014. A promise of further devolution is unlikely to inspire a great deal of public support as an alternative to independence. If the unionists want to make a credible case for Remain, they will have to learn to live with the federal option.

The F-word

The word federal was until fairly recently taboo in the British constitutional dictionary. Federalism appeared to be inconsistent with the British constitutional tradition. It was seen as an alien, continental concept, best left to others. Moreover, federalism was taken to be a slippery stepping-stone, legitimising eventual independence.

This latter concern has little meaning where Scotland is concerned. It is already heading for possible independence. Offering a federal solution does not add further legitimacy to the claim to statehood. This entitlement already exists and is not disputed in principle by Westminster. Hence the referendum of 2014.

In truth, a federal alternative to independence is quite inconvenient for both unionists and for those seeking independence alike. A federal option goes against the sense of unionists that things should stay as they are, having proven their value and worth over centuries.

On the other side, a credible federal option would undermine the case for independence favoured by the SNP. If federalism is possible, could it offer the advantages that independence might bring, without running the risk of going it alone in a rather uncertain global environment?

And there are major uncertainties. Could an independent Scotland sustain the present standard of living of its population? The oil-price has sunk dramatically and oil and gas are running out as we are heading towards a zero-carbon world.

Would Scotland standing alone lose out on trade and security, especially if renewed EU membership is uncertain? What about the ability to draw on a far larger, national infrastructure to tackle emergencies like Covid-19?

Posing a reasoned alternative

These are difficult questions that need answering, calmly, objectively and without prejudice. And unionists and the SNP alike owe it to the people of Scotland to consider the federal option as the alternative, to weigh the respective benefits and risks.

Of course, some in Scotland will go for union or independence whatever the arguments, perhaps driven by sentiment. Sentiment is a legitimate source of political choice when confronted with hundreds of years of contested and, for many, painful history between the two nations.

The 2014 referendum has however shown that most in Scotland want to go beyond emotions and consider the actual facts. While the emotional appeal of independence may be high, the economic and political risks of independence may be too significant to be ignored or replaced by simple hope. At least the trade-off, if there is one, needs to be examined in the cool light of day and with a rational, open mind.

This means that a federal alternative has to be, first of all, defined and expressed.

A unique solution for Scotland and Britain

Form follows function in state design. So, the starting point for the people of Scotland is to achieve clarity about their aims, their needs and interests. What, specifically is independence meant to deliver, and what more is required to meet these needs?

Is it the need to give greater expression to Scottish culture and history? Is it the wish to escape perceived economic marginalisation by Westminster, or perhaps the ambition to construct a more equitable and enlightened society? Is it a more visible and independent role in shaping global affairs?

Once these needs have been articulated, a federal option can be designed to meet them. Clearly, finding a federal formula for Britain will be difficult. This is not a case of copying the Canadian, German or Swiss model. A bespoke solution has to be found that is likely to be as unusual as the circumstances that prevail at present in the UK.

Thus far, the UK has developed through devolution. Powers have been gradually handed down to three of the four constituent units of the union. These powers were granted by acts of the UK parliament, which remains the dominant layer of legislative authority. Controversially, devolution can even be reversed unilaterally by the centre, simply through changing the legislation on each of the devolved entities.

Federalism is different. A federal constitution will define the constituent entities and their powers and institutions, along with the remaining authority of the central bodies of the federation. The shape of the federal units is permanent and cannot be changed without their consent.

Federalism as an exercise of sovereignty for Scotland?

There are two types of federation, depending on the founding myth that underpins them. Some federations claim that they came about through the voluntary union of entities that are, in principle, sovereign. They have pooled their sovereignty in certain areas to achieve a limited set of common functions through federal organs. But they retain so-called residual authority over all areas of competence not expressly assigned to the centre in the constitutional compact.

In other cases, it is made clear that sovereignty is held collectively by all the nations and people of the overall state, taken as one. Power is then shared out from the centre to the individual federal units. The legal personality of the constituent units is derived from the centre.

In this case, unionists might point to the Treaty of Union of 1706. The Articles of Union promise that the two kingdoms of Scotland and England shall be united forever after into one kingdom. This would have extinguished the legal identity of Scotland as a source of sovereignty, making its re-emergence as a federal entity dependent on a grant of authority from London.

On the other hand, for many Scots a federal solution would presumably only be acceptable if it visibly revives their proud tradition and heritage, re-consecrating Scottish sovereignty. Joining the new federal system would be taken as an exercise of renewed sovereignty, and not as a denial of the claim to sovereignty. This logic may seem like dancing on the head of pin, but the symbolism involved in this kind of question can make or break the chances for a federal settlement.

Forms of federation

The next issue is the basic shape of the federal system. Ordinarily, a federation is characterised by a number of equal federal units, each having the same powers and institutional furniture. Clearly, that will not be the case in the UK a composite of four nations, each of which has a different history and system of governance.

It is also possible to construct a federation as a so-called federacy. This would mean that the rest of the UK remains more or less untouched, while the status of Scotland is upgraded to that of a federal subject enjoying a unique legal identity of its own.

A third option is that of an asymmetrical federation. This would accept that Wales retains powers and institutions different to those held by, say, Northern Ireland. This is partly due to different histories, traditions and needs. It is also due to the Northern Ireland settlement, which involves the Republic of Ireland.

Moreover, the so-called West Lothian question would finally be addressed. England, too, would become a federal subject, enjoying its own distinct competences and institutions, perhaps giving more expression to its own regions or major cities.

Within such an asymmetric set-up, Scotland could express its identity to a very considerably enhanced extent. It would feel like its own state, without incurring the penalties and costs of setting one up.

More power?

The second major issue arising in federations is competences. Inevitably, there will be exclusive competences exercised by the centre. This may concern defence and national security, border and customs, transport and communications, a national framework for economic development, protection of genuine democracy and human rights, etc.

Then there may be competences shared between the centre and federal units. For instance, the centre may establish a joint framework for educational attainment in schools, while the federal entities will adopt legislation to implement this in their own way.

Finally, in accordance with the key principle of subsidiarity, the competences that can be best exercised within the federal units will be exclusively assigned to them.

The present devolved settlements for each region already contain detailed schedules assigning competences to the different levels of government. It would be useful for Scotland, or the SNP, to articulate clearly what additional powers it seeks to gain through independence. It would then be possible to see whether or not a federal model can accommodate such a demand.

Changing institutions and finance

Third, there is the issue of institutions. This poses few problems for the UK as three of the four regions have their own, highly developed institutional architecture. England would, of course, need to decide whether it wishes to establish its own, dedicated layer of legislature, executive and judiciary.

Of course, a federation is not only about powers of the federal units. A number of central functions and federal institutions will remain.

Where powers are retained by, or transferred to, the centre, the question of power-sharing arises. The weighting of seats in the national parliament might need consideration, to ensure that each region can have a significant voice of its own in relation to matters of national policy.

The more significant change would occur in relation to the House of Lords. In addition to its function as a federal revising chamber, it would assume the role of safe-guarding the rights and interests of the federal units in national decision-making. Its composition would therefore need to reflect the identities of the four federated nations.

Happily, the move to the Supreme Court as an institution separate from the House of Lords makes it easier to ensure that legal disputes between the constitutive units, or between them and the central authorities, can be addressed.

There might also be provision for executive power-sharing, ensuring that all nations are fully and meaningfully represented in government and the national civil service, and can shape common decisions on defence, external relations and other central competences.

Finally, the important question of funding arises. At present, Scotland receives most of its budget in the form of a block grant from Westminster. In a federal system, funding follows function. Central funding would be increased according to the additional competences administered by the federal units. More likely, the federal units would be given their own income by shifting the powers of taxation and raising duties, perhaps supplemented by federal funding.

An element of federal funding would not only be needed to cover central services of the federation. It would also be required to meet unexpected needs of a federal unit, say in case of a natural disaster, and to balance out inequities between the units due to geography or economic development. This balancing function, or safety net, would be lost in case of independence likely a significant loss of Scotland.

Overall, it would be possible to construct a federal solution that takes account of the particular history of Britain while significantly enhancing Scotlands sense of identity and powers as a state within a federal union. However, such a vision needs to be developed and expressed in some detail, before it can be judged against the needs articulated by the people of Scotland, and against the alternative of independence.

Marc Weller is professor of international law and international constitutional studies at the University of Cambridge and a barrister at Doughty Street Chambers

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Federalism could make Scotland feel like an independent state without the costs of becoming one Professor Marc Weller - The Scotsman

KP Oli who spent years in prison to overthrow the monarchy cant think of reinstating it

KATHMANDU, Feb 5:

Amid widespread speculations that Prime Minister KP Sharma Oli might make a surprise announcement regarding secularism, federalism and monarchy at the mass gathering organized in Kathmandu on Friday, PM Oli chose not to make any controversial statement. Instead, he said that the country would move forward implementing federalism and republicanism in the country.

PM Oli, while addressing the mass gathering organized by his faction of the ruling Nepal Communist Party (NCP) in front of the Narayanhiti Royal Palace Museum on Friday, assured the public that he was not in favour of reinstating monarchy in the country as rumored in the market.

KP Oli, who spent years in prison to overthrow the monarchy, can't think of reinstating it. Well proceed ahead through the effective implementation of the federal democratic republican system, Oli said.

On the occasion, he took his time to laud the efforts made by the local units in the governments fight against COVID-19 pandemic.

Oli, who has been blamed for taking an unconstitutional move through the dissolution of the House of Representatives on December 20 earlier in the last year, said that forthcoming April-May polls will further strengthen democracy in the country. The government has announced elections for April 30 and May 10 later this year. His move, however, has been objected by various political parties including a rival faction of the NCP led by Pushpa Kamal Dahal and Madhav Kumar Nepal.

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PM Oli clarifies his stance on monarchy and federalism - MyRepublica

Marew Abebe, Lecturer of Federalism Studies at Debark University, Ethiopia; Contact him via marewobu@gmail.com; ID

Introduction

During the last three decades of federalism experiences in Ethiopia, it was the Ethiopian Peoples Revolutionary Democratic Front (EPRDF)the ruling government since the inception of the federal system political ideology not the constitution that dictates the countrys federalism promises. The EPRDF party composed of four ethic based parties did follow only centralized decision making and ordered member parties of the coalition to channel its political interest within their respective constituencies. Following the coming of new PM Abyi Ahmed and the dissolution of the EPRDFthat claimed itself as patronage of Ethiopian federalismthe government has struggled to hold the country together.

Federalism by constitution and unitary in practice

In December 2019, EPRDF ceased and was rebranded as the new Prosperity Party with three former parties. The Prosperity Party has also dismantled the old age decentralized decision making and the partys ideology have been challenged and forced to change its top down order to local governments. As the result when the local governments, as the independent administration regions of most federal states, trying to exercise their own constitutional granted rights for their own internal matters shakes the long-held federalism practice in Ethiopia. It becomes risky to the very federal system when the federal government still wants to retain its status quobeing the higher government. This conundrum between the federal and local government was evident when the Tigray region, one of the ten members of the Ethiopian federation, unilaterally decided and held regional elections amidst the pandemic that was postponed by the federal government. The Tigray regions decision of holding election on 9 September 2020 for its State Council in explicit defiance of federal government severely exacerbated the situation and has remained one of the greatest litmus tests to the Ethiopian ethnic based federalism. Later this led to the full scale war between the Ethiopian federal and the Tigray regional governments.

Recently, the vertical federalism arrangement between the federal and regional governments becomes fragile due to the federalism culture not being embedded by constitutionalism but has long been guided by political ideologies and considerations. When parties change and ideologies shift, the very states structure (federalism) is, now, without guardian. This is due the Ethiopian federalism has long been handing on the single party willingness and directives. The intergovernmental situation, the horizontal relationships among regional governments themselves, also deteriorates due to, among other things, border conflicts between regional governments, competitions over scarce resources and competing nationalisms. Moreover, the Ethiopian federalism has not any legal frameworks that would have guided the intergovernmental relations and has not set any common mode of communications, although as a matter of fact Amharic has been used.

Wheare in his 1946 seminal work on Federal Government defined federalism as follows: by the federal principle I mean the method of dividing powers so that the general and regional governments are each, within a sphere, co-ordinate and independent. Thus, in federalism state structure, as opposed to unitary one, there exists a compound polity in which two co-equally supreme levels of governments both acted directly on the citizen through their own law, under a written constitution. Federalism, by its very nature, needs a common written law (constitution) and an observance of it, what is called constitutionalism. This is exactly what the Ethiopian federalism lacks, constitutionalism, as neither the federal nor the states act based on the common covenant document, the Ethiopian federal Constitution. It was arbitrary rule and mere political agreements among and between groups, short of political parties at the expense of the constitutional provisions, rules the country.

According to Berihune Adugna (2020), federalism inEthiopia has operated in a single-party system run by the EPRDF with a blatant disregard of theEthiopian Constitution andofficialrejection of liberal democracy. The Constitution has merely been often cited as a justification for the authoritarian and undemocratic actions of the EPRDF, its leading ideology of revolutionary democracy and the party practice of democratic centralism hasplayed the real constitutional function in practice. Since the introduction of federalism, multi-party democracy, respect for human rights, and constitutionalism have been put aside and given way to the emergence of the EPRDF as the only viable political party in the country. The Ethiopian federalism has been submissive to the short lived political ideologies of a single party. And there were not genuine federalism experiences; rather there was more a unitary state in its practices as the real power comes from the center and from the party.

Generally, after three decades of ethnic federalism experiences, the dominant rhetorical figure in Ethiopian politics is that of ethnicity, which has permeated daily life and overtaken democratic decision-making and shared issue-politics. This overshadowed real federalism exercise in Ethiopia. The regional governments had been accorded nominal decentralized power and the government has developed structures of central control and top-down rule that preclude local initiative and autonomy.

The way outs

This highly combustible mixturea divided political center, an ineffective and ambiguous regional elite, ethnic based federalism, competing nationalism and the liberation struggleis at the root of todays unrest. But how these are to be reconciled and what scope they can have still remains unclear. To quell the masses and to heralded genuine federalism, the government in Ethiopia must work hard to respect for political liberties, human rights and economic equality. Recognizing the fundamental unity, rights and solidarity of all Ethiopians requires positive, constructive attitude and should be based on the umpire constitution.

Marew Abebe

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Federalism without the Guardian: Ethiopia in the Row - Satenaw Ethiopian News/Breaking News | Your right to know!

One of the biggest triumphs associated with GST is cooperative federalism, which has demonstrated successful collective decision making through the GST Council. It is therefore imperative that the same cooperative federalism model of the council be leveraged to finally put in the last piece of the GST revenue jigsaw - inclusion of petroleum products into GST and to engage a workable resolution on resolving the taxability of the online gaming industry. This will boost GST collections and further smoothen Centre-state relations.

Though the GST law now covers almost all aspects of goods and services, there are still areas where states continue to have separate jurisdiction or divergent views. One key area is the taxation of petrol products, which are now outside the ambit of the GST law.

The other is taxability of the online gaming industry, or more specifically, on determining whether it is a game of skill or a game of chance. The GST Council has, over the past three years, deliberated on both these areas but has been unable to reach an acceptable resolution.

Budget 2021

The petroleum sector is a key input for all industries. With fuel prices hitting record highs recently due to increased taxation, there is an urgent need for the administration to find a solution that will keep revenues intact and address the price rise.

The inclusion of petroleum products can lead to efficiencies in this sector. An area of focus for the Atmanirbhar Bharat initiative is on building India's energy security and reducing our dependency on oil imports.

A globally competitive GST regime for petroleum products can attract desired investments into this sector and reduce oil imports. Along with the rationalisation of fuel prices, this will benefit the entire country, including all states.

Until March 2020, GST collections had been showing an upward trend year-on-year. This trend is once again visible from December 2020. Hence, except for the period of lockdown, GST collections have been growing.

Also Read: Budget 2021: Date, time, sector-wise expectations; everything you need to no

The chart below shows trends in monthly gross GST revenues for FY 2018-19 and FY 2019-20.

The chart below shows trends in monthly gross GST revenues till the month of December during the current year i.e. FY 2020-21 as compared with FY 2019-20.

Growth in GST collections is likely to continue as economic activity picks up going forward. Though the short-term focus is to recover from the shortfall due to the pandemic, the administration should now initiate dialogue and discuss options for the inclusion of petroleum products within GST.

The over Rs 6,500-crore online gaming industry has bucked the popular trend and sustained its rapid growth even in the pandemic. India's fantasy sports sector has grown nine times in three years, with one marquee firm even winning an IPL sponsorship and featuring as the subject of a Niti Aayog white paper to discuss uniform regulations for the gaming sector.

Employment generation is a focus area for the government and online gaming industry has and will continue to generate thousands of jobs. News reports state that the Union Education Ministry is working to support students in online gaming and toy making to generate employment opportunities. Being a sunrise sector for India, online gaming requires support to continue its growth trajectory.

Also Read: GST collection to be record Rs 1.20 lakh crore in January: SBI report

Niti Aayog recently released a white paper for discussion on uniform regulations for the gaming industry, minus the tax aspects. States currently have divergent views on the industry, with some even banning online gaming.

So, along with uniform regulations, the industry needs a uniform tax position under GST. However, lack of clarity on what constitutes a game of skill versus a game of chance has created uncertainty about the taxability of the winnings. The debate on taxability revolves around whether such gaming can come under the scope of gambling.

There is jurisprudence, including under GST law, on what constitutes a game of skill versus a game of chance and the resultant taxability of online gaming, and the matter is currently pending in the Supreme Court. It could take a long time to find a resolution to this matter, through the litigation route.

The GST Council with its platform of cooperative federalism should be utilised to bring clarity on the taxability of the online gaming industry and support its growth for employment generation.

The Union Budget no longer contains policy announcements on GST, which is now the prerogative of the GST Council.

However, the inclusion of a statement in the budget, of an intent to resolve these tax issues, will not only bring cheer to these industries and have a positive impact on the broader economy, but also reaffirm confidence in the cooperative federalism model for tax policy.

(The author is Partner, Deloitte India.)

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Budget 2021: Cooperative Federalism - the route to increase GST collections - Business Today