Goods and Services Tax (GST) Council’s 57th Meeting: Process Reforms Targeting Ease of Doing Business

On October 8, 2026 the GST Council, chaired by Union Finance Minister Nirmala Sitharaman, approved process reforms: removal of GST officers’ arrest powers, raising the prosecution threshold to Rs 5 crore, cutting the general penalty to Rs 10,000, automating GST registration for low-risk taxpayers, reducing the refund-acknowledgement window to 10 days, and provisioning provisional sanction of 90 % of eligible refunds within three days. ITC refunds will extend to input services from Nov 1 2026 and to plant and machinery from Apr 1 2027 (spread over 60 months).

GST council scraps arrest power of tax officials, approves faster refunds: FM

The GST regime, launched on July 1 2017, completed a major rate-rationalisation in 2025. With rates settled, the Council shifted to “GST 2.0” – improving compliance, reducing litigation, and moving enforcement to data-driven detection. Earlier meetings highlighted bottlenecks such as delayed refunds, manual registration, and criminal-law provisions deemed disproportionate.

GST Council reforms: Arrest powers scrapped, prosecution threshold raised to Rs 5 crore

• Taxable supplies rose 25.8 % to Rs 50.58 lakh crore per month; effective tax rate fell from 14.55 % to 13.13 %.

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• 61 % of GST registrations already use an automated three-day route; the Council aims to extend this to all low-risk applicants.

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• 65 % of refund claims relate to exports or inverted-duty structures, with 55 % classified as low-risk.

GST Council meeting: Businesses can now get 90% of claimed refunds in 13 days

• The materiality threshold for GST notices is Rs 10,000, covering about 20 % of cases by number.

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Faster refunds and expanded ITC will free working-capital tied up in credits, especially for exporters, manufacturers and MSMEs. Automation reduces administrative friction for multi-state businesses. De-criminalisation shifts enforcement from deterrence to detection, lowering compliance risk for routine errors. Standardised dispute-resolution could cut litigation costs and improve predictability.

GST Council likely approved faster registration, ITC and refund reforms, sources say

She noted implementation from Apr 1 2027. Union Finance Minister Suresh Kumar Khanna said the reforms will “immensely benefit” businesses. The Council announced a three-month committee to study protection for buyers whose suppliers default on tax deposits. Industry bodies welcomed the move toward a “trust-based” administration.

GST Council approves process reforms; supplier-default ITC proposal referred to committee

• “The decision to automate the provisional grant of 90 per cent will provide a significant boost to the industry that can put liquidated capital back into business, promoting Make in India,” — Pratik Jain

Industry hails progressive GST reforms as major boost to ease of doing business

• “When we say arrest has been taken out, taken out from a tax officer's hands,” — Nirmala Sitharaman

In Major Reform, GST Council Scraps Tax Officers' Arrest Powers

The proposal to extend ITC on motor-vehicle purchases was deferred pending review, indicating incomplete consensus. Detailed rules and system upgrades for automated refund and registration modules are still pending, leaving uncertainty about rollout timing.

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The Council will issue implementation guidelines for the automated modules before its next meeting. The buyer-protection committee’s report will be considered for legislative amendments. Future rate-related matters will be addressed only in an annual dedicated meeting.

GST Council meet: Scrapping tax officers' arrest powers, decriminalisation among reforms on agenda