The 57th GST Council's general meeting, which began at 11 AM  on Thursday, October 8, at Bharat Mandapam in New Delhi, has concluded, and the Finance Minister has announced the key decisions taken by the council. The announcements include relief in tax refunds, a curb on arrests and reduced penalty amounts.  

GST Council 2026: Key Announcements

  • The council approved automatic acceptance of routine changes in registration.
  • Additionally, faster clearance of refunds, with the acknowledgement period reduced to 10 days from 15 days.
  • The minister said that 90% of refunds will be issued within 3 working days.
  • The council removed the power of arrest under the Goods and Services Tax regime. It has also raised the threshold for prosecution to Rs 5.
  • The general penalty has been reduced and will be applicable where no specific penalty is prescribed, from Rs 25,000 to Rs 10,000.

Arrest And Punishment Threshold 

The power of arrest is being removed from GST, and the prosecution threshold has been raised from Rs 1 crore to Rs 5 crore. 

The minimum punishment has been removed. Additionally, the council reduced the general penalty from Rs 25,000 to Rs 10,000. Late GST taxpayers who usually fall behind on payment will face recovery, interest and a proportionate penalty. However, they will not be charged beyond.

Big Relief For Small E-Commerce Businesses 

In a big relief for online goods sellers, the council approved a simplified GST registration mechanism for small sellers. Now, small businesses will be able to sell by establishing a place of business in each state. 

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ITC For Expenditure, Smooth State-to-State Business And Other Announcements 

  • ITC is now allowed to claim additional business expenses, including telecom towers and employer-provided insurance.
  •  Banks will pay a 3 per cnet IGST on gold and precious metal imports to align tax parity across import routes from April 1, 2027.
  • GST rate adjustments will now occur only once a year.
  • An officers' committee has been formed to resolve ITC issues and streamline claims for honest taxpayers.
  • Plans are underway to create a unified tax framework for the 69.5 lakh taxpayers under CGST jurisdictions.
  • A Faceless Tax Administration model under CGST will be introduced in FY28 following public consultation.
  • No tax notices will be issued for monetary thresholds of Rs 10,000 or lower.
  • To ease goods movement, inspections, detentions, or seizures can now only be carried out by officers from the origin or destination states.