The GST Law Committee has proposed raising the prosecution threshold under the tax law to Rs 10 crore. The current limit is Rs 5 crore.

The committee of Centre and state officials also wants shorter jail terms for some offences. For tax evasion between Rs 5 crore and Rs 10 crore, the maximum sentence would fall from three years to two years.

Courts would get more discretion to choose between imprisonment and fines. The threshold was last revised in 2017. Officials say it needs an upward revision as the economy has grown.

The proposals will go before the GST Council at its October 7 meeting. There is broad agreement on revising prosecution and punishment provisions.

But the committee could not agree on arrest powers. Some members want to scrap the power of tax officers to arrest under the GST law. Others want to keep it. The Council will take the final call.

The changes are part of a wider decriminalisation push. The aim is to separate minor lapses from wilful fraud and improve the business climate.