Story perspectives

GST Council Approves Reforms, Cuts Penalties, Limits Arrest Powers

By Drooid · Oct 8, 2026, 5:00 PM UTC · How we work

Summary

Story summary

The 57th GST Council approved a GST reform package.
It removed GST officers’ arrest powers and raised the prosecution threshold to Rs 5 crore.
The general penalty for GST offences fell to Rs 10,000 from Rs 25,000.
The Council simplified GST registration for small e-commerce sellers using an operator’s warehouse as principal place.
Finance Minister Nirmala Sitharaman said reforms start 1 April 2027 with annual GST rate revisions.

History

Historical Context

India’s unified Goods and Services Tax began on 1 July 2017 under Prime Minister Narendra Modi, with the initial framework classifying 1,211 items into five slabs. After the 2025 rate rationalisation that cut slabs to 5% and 18%, the 2027 GST Council voted to drop arrest powers and lower penalties, echoing the original push to ease compliance for small e-commerce firms.

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Story summary

The 57th GST Council approved a GST reform package.
It removed GST officers’ arrest powers and raised the prosecution threshold to Rs 5 crore.
The general penalty for GST offences fell to Rs 10,000 from Rs 25,000.
The Council simplified GST registration for small e-commerce sellers using an operator’s warehouse as principal place.
Finance Minister Nirmala Sitharaman said reforms start 1 April 2027 with annual GST rate revisions.

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