The Daily PulseBusiness
GST Council Ends Arrest Powers for Tax Officers and Raises Prosecution Limit
Reported by Rituparna Sen (Section Editor) · The Hindu - Business ·
Confirmed by a second source: Business Standard - Top Stories
The GST Council has removed the arrest powers of GST officers and raised the minimum limit for launching prosecution from ₹1 crore to ₹5 crore.
Changes in Penalties
The 57th GST Council meeting in New Delhi also decided to remove the minimum punishment. Courts will now decide the punishment, whether fine, jail, or both, for every case. The general penalty drops from ₹25,000 to ₹10,000 where no specific penalty is listed. Tax rate changes will happen once a year from now on, as the rate structure is now settled.
Input Tax Credit
A new Committee of Officers will study input tax credit claims within three months. This group will look at ways to protect honest buyers who hold valid invoices, get their goods, and pay suppliers in full.
Context
The GST Council brings together the Union and State Finance Ministers to make joint decisions on indirect tax laws in the country. Changes to thresholds and arrest powers aim to ease business compliance and reduce legal disputes for taxpayers.
ExplainerWhy this matters
What Happened
The GST Council made major changes to tax enforcement rules, removing arrest powers for tax officers and increasing the threshold for prosecution to ₹5 crore.
Why It Matters
These changes lower the legal risks for businesses by stopping immediate arrests and raising the bar for criminal prosecution, which gives tax payers more breathing room against strict penal actions.
What Happens Next
The newly formed Committee of Officers will review input tax credit rules and present its report within three months for the next Council meeting.
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