New Delhi, Oct 9 : The high-powered GST Council on Thursday approved removing the arrest power of tax officials and raising the threshold for prosecution fivefold to Rs 5 crore, while introducing faster and largely automated refunds for taxpayers.
Announcing the decisions taken at the 57th meeting of the GST Council, Finance Minister Nirmala Sitharaman said it also decided to bring down the general penalty from Rs 25,000 to Rs 10,000.
The changes approved by the GST Council will be implemented from April 1, 2027.
The Council also cleared a proposal that a taxpayer who files late, makes a mistake or falls behind on payment will face recovery, interest and a proportionate penalty, and nothing beyond that.
Another key recommendation was about extending refunds under the inverted rate structure to input services. The change will be available for credit availed on or after November 1, 2026, Sitharaman said.
The Finance Minister also said that the government intends to introduce faceless tax assessment for Central Goods and Services Tax (CGST) taxpayers registered in multiple states.
Sitharaman said the power of arrest will be removed from GST and the threshold for prosecution will be raised from Rs 1 crore to Rs 5 crore.
Also, no notices will be issued in cases below a monetary threshold of Rs 10,000. ( PTI )
