GST Council Meet: Biometric Authentication & 9 Other Big Announcements by FM Nirmala Sitharaman

The 51st GST Council meeting, chaired by Finance Minister Nirmala Sitharaman, concluded with a flurry of significant announcements aimed at streamlining the Goods and Services Tax (GST) system and boosting economic growth. Here are the 10 key takeaways from the meeting:

1. Biometric Authentication for GST Registration:

In a major move towards strengthening security and curbing fraud, the GST Council approved the introduction of biometric authentication for GST registration. This new measure will require applicants to submit their fingerprints and iris scans, making it significantly harder for individuals to register multiple fake identities for fraudulent activities.

2. E-invoicing Threshold Lowered:

The GST Council decided to lower the mandatory e-invoicing threshold from ₹20 crore to ₹10 crore. This move is expected to bring more businesses under the e-invoicing net, further digitizing the GST ecosystem and reducing compliance burdens for smaller businesses.

3. New GST Return System to Roll Out in January 2024:

The Council approved the rollout of the new GST Return system from January 2024, replacing the current system with a more efficient and user-friendly platform. This will simplify the process of filing returns and enable businesses to track their GST liability more effectively.

4. Simplification of Input Tax Credit (ITC) Rules:

The Council approved changes to the ITC rules to simplify the process and enhance transparency. This will ensure that businesses can easily avail ITC for their eligible inputs, reducing their tax burden and enhancing ease of doing business.

5. Tax Rate Rationalization:

The meeting also saw the rationalization of GST rates on certain goods and services, including:

Reduction in GST rate on certain types of textiles from 12% to 5%
Clarification on GST rates for goods supplied through e-commerce platforms
Simplification of the GST rate structure for restaurants

6. GST Compensation to States Extended by 1 Year:

The Council decided to extend the GST compensation to states for another year. This will provide crucial financial support to states, enabling them to continue their development initiatives and bridge the revenue shortfall arising from GST implementation.

7. Dispute Resolution Mechanism Strengthened:

The meeting saw the strengthening of the dispute resolution mechanism, enabling faster and more efficient resolution of disputes between taxpayers and the tax authorities. This will foster a more harmonious and efficient GST ecosystem.

8. Enhanced Focus on Digitalization:

The Council underscored its commitment to enhancing digitalization in the GST ecosystem. This will include initiatives like promoting online payments and strengthening the use of technology to improve compliance and ease of doing business.

9. GST Portal Improvements:

The Council approved further improvements to the GST portal, including enhanced functionalities and user interfaces, making it more user-friendly and efficient for taxpayers.

10. GST Council Meetings to be Held More Frequently:

The Council decided to hold meetings more frequently, allowing for faster decision-making and prompt implementation of policy changes.

These significant announcements demonstrate the GST Council’s unwavering commitment to continuously refine and improve the GST system, fostering a robust and compliant tax environment for businesses and individuals across India.

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