The Goods and Services Tax (GST) Council on Thursday (October 8, 2026) took a slew of decisions in its 57th meeting to enhance simplification, improve certainty in tax treatment, remove holdups in the processing of input tax credits, and ease the compliance burden on businesses, especially smaller ones. 

The Council met in New Delhi more than a year after its previous meeting in September 2025, during which it had rationalised the rates on most goods and services, and reduced the total number of tax slabs under GST.

“I can say that 99% of issues in GST relating to rates and processes have now been addressed,” Union Finance Minister and Chairperson of the GST Council Nirmala Sitharaman said at the press conference following the meeting. “The door is not closed to further reforms, and those will be taken up as needed, but the bulk of them are now done.” 

“The process reforms have been driven by the principle of trust,” she added. “The businesses and taxpayers have to be trusted… and we shouldn’t be too intrusive.”

Apart from easing processes related to GST registration and availing of refunds and input tax credits, the Council has also eased the litigation-related rules of the tax system, providing relief to small taxpayers. 

Ms. Sitharaman said that all the changes are expected to come into effect from April 1, 2027. 

She added that no GST rates were changed during this meeting, and that rate decisions will now come up before the Council only once a year and will be implemented from the start of the subsequent financial year. 

The Finance Minister said that, beyond the GST Council, the Central government has decided to introduce a faceless assessment system for the Central GST system, similar to the one currently in place for income tax. A framework for this will be issued for public consultation before Budget 2027, and the system will be implemented during 2027-28.

Easing registration, filing and refunds

The GST Council has approved a system that will provide greater certainty about the documents required during registration. According to the government, 61% of taxpayers are granted automatic registration within three working days. 

The upgraded system approved by the Council is expected to streamline the process for the remaining low-risk taxpayers by avoiding queries and rejections.

The new system will also incorporate a simplified registration mechanism for small taxpayers who provide supplies through e-commerce platforms, and it has also eased the process for amendments to and cancellations of registrations. This will now allow these small e-commerce sellers to register in a single State rather than in each State where they sell goods.

The Centre has also shared a concept note with the GST Council and has received its in-principle approval for an optional scheme for businesses with a turnover of up to ₹5 crore that supply to consumers, allowing them to file returns once a year instead of quarterly. The final decision on this will come up for approval in the next GST Council meeting. 

Refunds are proposed to be acknowledged within 10 days, down from the current 15 days. Based on a risk assessment, the government estimates that 90% of the claims will be released within three working days of acknowledgement. 

The Council has recommended allowing input tax credits for additional business expenditure, including employee health and life insurance. Further, input services will also be eligible for refunds under the inverted duty structure from November 1, 2026. 

Reducing disputes, notices and litigation

The GST Council has announced common standards for notices and proceedings, under which no notices will be sent for a tax amount below ₹10,000. Further, all pending notices already issued that fall below this threshold will be withdrawn.

A recurring issue among taxpayers is that they often get denied input tax credits because their suppliers have not filed their returns, even though they themselves have complied with all the processes. The GST Council has decided to instruct its officers’ committee to examine this issue. The decision on this is also expected to be taken so that it can be implemented by April 1, 2027. 

The Council has also said that goods moving between States can be inspected, detained or seized only by the officer of the supplier or destination State and not by any officer in between. Further, goods can now be intercepted only on the basis of “specific intelligence” and only with the authorisation of a joint commissioner-level officer. 

“This prevents arbitrary checks by GST enforcement wings that affect the movement of goods from one State to another,” Ms. Sitharaman said. “This would significantly improve the ease of movement of goods.”

The Council also recommended removing arrest powers under GST and increasing the prosecution threshold from ₹1 crore to ₹5 crore. The general penalty will also be reduced from ₹25,000 to ₹10,000. 

Simplified norms for service exports

An Indian firm selling services to a foreign client through its own overseas branch can now avail of export benefits under the GST system. Further, testing, repair, certification, and research done in India for a client abroad is proposed to be classified as an export of services even if the goods stay within the country. 

The Council has also decided that the date on which an export payment is deemed to have been received will follow the Reserve Bank of India’s rules. This will eliminate uncertainty and allow exporters of services not only to recover the tax paid on the export of services, but also recover this amount faster. 

Published – October 08, 2026 06:14 pm IST