The 57th meeting of the GST Council is scheduled to be held on 7 October 2026. Changes in tax related rules and procedures can be discussed in the meeting.
Business News: There are preparations for major changes in the rules and procedures related to Goods and Services Tax (GST). The 57th meeting of the GST Council is scheduled to be held on 7 October 2026. Many proposals related to making the compliance process easier for taxpayers and businessmen can be discussed in the meeting. These include proposals like changing the arrest powers of GST officials, increasing the threshold for criminal action, simplifying the registration process for small e-commerce sellers and securing input tax credit (ITC) for genuine buyers.
These potential reforms are being considered as important steps towards making the tax system more simple and business-friendly under GST 2.0. The proposals are aimed at reducing unnecessary disputes between the tax department and taxpayers and reducing the compliance burden on small businesses.
Rules for arrest of GST officers may change
The proposal to change Section 69 of the Central GST (CGST) Act may be discussed in the meeting. In the present system, in some cases arrest action can be taken on the basis of the approval of the Commissioner. Under the proposed change, court approval is being considered mandatory before arrest even in cases of serious financial fraud.
With this change, businessmen can get protection from arbitrary or hasty arrests. However, legal action is likely to continue in cases of serious tax fraud and willful tax evasion.
Proposal to increase the limit of criminal action on tax evasion
The current threshold for initiating criminal action under the GST law is Rs 1 crore. A proposal to increase this limit to Rs 5 crore can be considered in the council meeting. This change may have a direct impact on cases where the amount of tax dispute is relatively small. However, cases of fake invoices may be excluded from this proposed relief. Issuance of fake bills without actual supply of goods or services may continue to be a serious offence.
No arrest in general tax dispute
Another important change in the GST law could be that a dispute merely over the interpretation or rate of tax may not be considered a criminal matter. Businessmen and tax officials may have different views regarding the tax rate, classification or input tax credit of a good or service. In the proposed system, unless a clear case of deliberate tax evasion or fraud comes to light, emphasis can be laid on keeping such common disputes out of the category of crime. This is expected to provide great relief to taxpayers doing honest business.
Small e-commerce businessmen may get relief
Meeting offers can also be important for small sellers doing business online. Under the new provision, it is being considered to allow the warehouse of an e-commerce platform to be used as the registered address of a businessman for GST registration. This may reduce the need for small online sellers to rent offices or shops in different states.
Reduction in expenses related to rent, security deposit and employees can make it easier to start and expand an e-commerce business. The proposed change is expected to benefit a large number of small sellers.
Preparation to secure ITC from right buyers
A major concern of businessmen regarding Input Tax Credit (ITC) in the GST system is related to the tax payment by the supplier. Many times, the buyer's ITC gets affected due to the supplier not depositing tax to the government despite the buyer having a valid invoice. In the proposed system, it is being considered to give more protection to the ITC of genuine and honest buyers. If the buyer has valid documents and proof of actual transaction, arrangements for recovery of tax from the defaulting supplier can be preferred.