The GST Council, at its meeting on October 8, is likely to push a series of process reforms aimed at making compliance easier for businesses, including easing registration for sellers on e-commerce platforms, removing arrest provisions under GST law and resolving ambiguities around the export of services through overseas branches of Indian companies, according to sources aware of the matter.
The Council is also likely to revisit the definition of exports to align it more closely with commercial activities that generate foreign exchange, while ensuring that state revenues are protected and, preferably, enhanced, the sources said.
The reforms are expected to focus on simplifying GST compliance, speeding up refunds, reducing disputes and ensuring a seamless flow of input tax credit. The industry is also expecting changes to return filing and other compliance processes.
Registration for sellers on e-commerce platforms such as Amazon and Snapdeal is likely to be substantially simplified, with greater use of artificial intelligence to streamline the process, the sources said.
“The focus will primarily be on the process reforms,” a Finance Ministry source said, adding that some “big bang” reforms could also be introduced to make GST more business-friendly by easing compliance for legitimate taxpayers.
State government sources said the agenda has been framed to ensure that state revenues remain protected and, preferably, are increased.
The Council is also likely to modify the definition of exports to align it with commercial activities that generate foreign exchange. It is considering changes to remove ambiguity over whether services supplied through an overseas branch of an Indian company qualify as exports.
A broader overhaul of export-related provisions could help some technology companies and business process outsourcing firms resolve ongoing litigation, the sources said.
Another significant reform is expected in the area of decriminalisation. The government is considering changes to provisions relating to defaults, with the objective of distinguishing between deliberate fraud and genuine compliance failures.
“We have realised that those who deliberately default or commit fraud are just a handful of businesses. We cannot make life difficult for the majority because of a few culprits,” a Finance Ministry source said.
The government is also considering removing arrest provisions under the GST law. Sources said GST officers would no longer have the power to arrest taxpayers, while prosecutions for offences could instead be pursued under the criminal law framework, including the Bharatiya Nyaya Sanhita (BNS).
