GST Council’s decriminalisation plan, explained
The GST Council may soften criminal provisions in tax law. The proposals come up at the October 8 meeting.
The key idea is to remove arrest powers from GST officers. Tax recovery would rely on interest and penalties instead.
The prosecution threshold could rise from Rs 1 crore to Rs 5 crore. Fewer cases would then reach criminal courts.
Genuine buyers may keep input tax credit with a valid invoice. The tax would be recovered from the defaulting supplier.
These are proposals, not law yet. The Council must approve them before any change takes effect.
Section 69 of the CGST Act currently allows arrests by tax officers. The proposal would remove that power. Serious fraud cases could still be prosecuted in court. The Rs 5 crore bar would reserve criminal action for big cases. Small businesses would face civil penalties instead. The plan follows the Jan Vishwas decriminalisation drive. Exporters may also get faster refunds under the package. The Council meets at Bharat Mandapam on October 8. Industry is watching closely.
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