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Informist, Wednesday, Aug. 26, 2026

 

By Priyasmita Dutta and Sagar Sen

 

NEW DELHI – The GST Council is likely to ease the compliance burden on businesses to promote a simpler business environment, a senior finance ministry official said. The council will particularly focus on streamlining processes for smaller businesses, which struggle to comply with the multiple requirements under the GST regime, the official told Informist. 

 

These issues will be addressed in the next leg of reforms – process reforms, as Finance Minister Nirmala Sitharaman announced last year. According to the official, simpler processes will make it easier for smaller businesses to meet compliance requirements and fulfil registration requirements. This will help widen the GST base. Currently, discrepancies between e-way bill data and data submitted by businesses in GSTR-1 or GSTR-3B returns, such as differences in invoice value and item quantity, trigger automated notices from the department, the official said. 

 

"Work is going on to synergise e-way bill data with return forms to prevent mismatches," the official said. "Reducing the number of return filings by small taxpayers will also help such establishments," the official said. Officers in the Central Board of Indirect Taxes are working on these issues, which the GST Council is likely to take up at its next meeting. 

 

The Council, which is mandated to meet every three months, last met in September 2025. 

 

The Centre and state governments are also working on uniform guidelines to facilitate GST registration for businesses with monthly output tax liability exceeding INR 250,000, and the proposal will be placed before the GST Council, CBIC Member Sanjay Mangal said Friday. Tax officers are also discussing automation of GST registration cancellation and streamlining the grounds on which a GST officer can cancel a business's registration, he added. 

 

The GST Council had last year approved a simplified GST registration scheme for small and low-risk businesses, which was rolled out on Nov. 1. These applicants have monthly output tax credit of less than INR 250,000. According to the finance ministry official, simplifying registration for large businesses that collect tax credit over INR 250,000 per month will significantly help widen the tax base. 

 

As of Jun. 30, there were 16.71 million active GST taxpayers, with 3.9 million migrating from the pre-GST era.  

 

The official also said that simplified norms will boost voluntary compliance by businesses, which will significantly cut down evasion. Over the years, the government has implemented multiple measures to curb GST evasion, including Aadhaar- and biometric-based registration and geo-tagging of businesses. Despite these measures, evasion through bypassing GST registration and claiming fake input tax credit persists. 

 

The government detected fake GST input tax credit claims to the tune of INR 747.82 billion in FY26, Minister of State for Finance Pankaj Chaudhary told the Rajya Sabha last month. According to Chaudhary, 1,517 fake GST registrations were obtained in FY26 using forged Aadhaar and PAN card details, leading to evasion of INR 99.40 billion.

 

The GST Council may also look into ways to further weed out fake claims and registrations, the official said. A few states, like Maharashtra and Bihar, are also using artificial intelligence to match data received from businesses through different forms and e-way bills to identify tax mismatches, the official added. End

 

Edited by Saji George Titus

 

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