Last year the GST Council cut tax rates. This year it has focused on how GST works day to day. The 57th meeting, held in New Delhi on Thursday under the chairpersonship of Union Finance Minister Nirmala Sitharaman, recommended changes to registration, returns, refunds, notices and the checking of goods on the road. The Chief Minister of Jammu & Kashmir was among those who attended.

No arrests, and a higher bar for prosecutionThe Council has recommended deleting Section 69 of the CGST Act, which means tax officers will no longer have the power to arrest under GST. The amount of tax evasion needed to start a criminal case will rise from ₹1 crore to ₹5 crore. The offence of wrongly taking input tax credit will be limited to taking credit without actually receiving the goods or services, or without an invoice. Punishments under Section 132 will also be rationalised. Put simply, honest mistakes will be treated as tax matters, not crimes, while fake-invoice fraud remains punishable.

Fewer notices, smaller penaltiesNo show cause notice will be issued if the total tax involved is less than ₹10,000 (CGST, SGST, IGST and cess together). Pending notices and appeals below this amount will be decided as if this limit had always applied.

In non-fraud cases, if the taxpayer pays the tax and interest within 30 days of the order (Section 73) or 60 days (Section 74A), the penalty will be only 5%.The minimum penalty of ₹10,000 in non-fraud cases will go, and the maximum general penalty under Section 125 will fall from ₹25,000 to ₹10,000.Where an order imposes only a penalty and no tax, the pre-deposit for........

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