With the Goods and Services Tax (GST) system having settled down, revenues remaining steady, and rates having been rationalised, tax experts across the board say the priority for the GST Council in its 57th meeting on October 8 should be on decisively easing the compliance burden for taxpayers.
The GST Council will meet in New Delhi on October 8 for the first time after its meeting on September 3-4, 2025, when it had introduced wide-ranging rate and slab changes. Sources in the Ministry of Finance have confirmed that the meeting will not deliberate on GST rates and will instead focus on a five-pronged effort to reform the tax system and its administration.
Tax analysts agree that this should be the priority of the Council.
Right time for reforms
The GST system turned nine years old on July 1, 2026. Through this time, the Council has met 56 times, has reformed the GST slabs, successfully implemented the 5-year compensation period to States, and the system has stabilised in terms of revenue.
“With high GST collections across the past few months, the GST Council in its next meeting scheduled on October 8, would be able to decide on several issues faced by businesses including relaxation of input tax credit restrictions, reducing complaints for service providers, providing faster refunds, etc, without being unduly worried about the impact of such measures on the GST collections,” MS Mani, Partner at Deloitte India, said.
The Hindu had reported on October 6 that the proposals by the Centre for the GST Council’s consideration would cover process reforms, structural reforms, ease of living and doing business, exports of services, and e-commerce. The final decisions will, however, be made clear only once the Council’s meeting concludes.
Several areas for improvement
“The most important process reforms will be allowing automatic and easy refunds especially to exporters, and preventing ITC accumulation, because these are economy wide effects on working capital for firms,” Rahul Ahluwalia, Founder Director of the Foundation for Economic Development said.
Prabhat Ranjan, Senior Director at Nexdigm, a business and tax consultancy, said that while rate rationalisation remains important, certainty of tax treatment can be as important as the rates themselves.
“A significant hidden cost of GST arises from interpretational uncertainty — whether on classification, input tax credit, valuation, place of supply or procedural requirements,” Mr. Ranjan explained. “When the same transaction can invite different positions across jurisdictions, businesses face not merely additional tax exposure but litigation costs, provisioning requirements, working-capital blockage and uncertainty in commercial decision-making.”
Technology to the rescue
Brijesh Agrawal, CEO of Busy Infotech, a company specialising in GST-related software services, said that the GST back-end system has become technologically sophisticated but everyday compliance remains complex for business owners.
“Key priorities should centre on consolidating tax slabs to a maximum of three [currently there are 6 slabs, including Zero/Nil, 0.25% and 3%], eliminating cess and overhauling Section 17(5) to allow unconditional credit on all verifiable business-to-business expenses,” Mr. Agrawal said.
At the moment, ordinary business costs are not entitled to input tax credits and so not only add to the costs of doing business but also potentially add to the price of the final product being sold.
The Hindu has learnt that the Centre is proposing a change in this regard, to allow ordinary business costs to also be included in the ambit of input tax credits.
Single registrations and audit
Another proposal that will be put up before the GST Council is to allow businesses to register in a single State and sell across the country instead of having to register their business in each of the States they want to sell in.
Nitin Vijaivergia, Partner, Price Waterhouse & Co further said that the proposed system of harmonising GST audits across multiple registrations would significantly ease the compliance burden on large taxpayers.
“A unified approach to issues that cuts across State lines would curb duplicative information requests and eliminate the risk of divergent conclusions on the same transaction,” Mr. Vijaivergia said.
“It would also equip tax authorities to deploy data analytics and risk parameters with precision, directing scrutiny where genuine risk lies,” he added. “For businesses, the dividend is clear: greater consistency, enhanced predictability and a leaner audit-related compliance cost.”