Affluence Advisory
In the recently held 56th GST Council meeting, the following key recommendations were made:
Rate rationalisation for certain goods and services
GST Council has proposed to rationalise the existing GST rate structure for various categories of goods and services.
Post-sale discount: Amendment proposed in section 15 and section 34 of the CGST Act
- Condition with respect to incorporation of post-sale discount terms in the agreement has been proposed to be omitted
- Post-sale discount can be passed through credit note in terms of Section 34 of CGST Act
- Withdraw the clarification provided vide Circular no. 212/6/2024-GST dated 26 June 2024 which dealt with the ITC reversal mechanism in the hands of the recipient
- New circular would be issued clarifying the following:
- Non-reversal of ITC on account of post-sale discount through commercial/financial credit note,
- Treatment of post-sale discount provided by manufacturer to dealer as additional consideration, in transaction between dealer and end-customer
- Treatment of post-sale discount as consideration in lieu of promotional activities performed by dealer
Granting of Provisional refund
- In case of zero-rated supply of goods or services including supply to SEZ unit for authorised operations, it is proposed to grant provisional refund based on certain identified risk parameters. A similar mechanism to be introduced for refund in case of inverted duty structure
Omission of place of supply provision in case of intermediary
- Section 13(8)(b) of IGST Act, which provides for place of supply in case of intermediary service i.e. the location of supplier, has been proposed to be omitted
Operationalisation of Goods & Service Tax Appellate Tribunal (GSTAT)
- GSTAT would be made operational for accepting appeals before end of September 2025 and will commence hearing before end of December 2025. Also, for filling of backlog Appeals, the date of limitation would be 30 June 2026
- Principal Bench of the GSTAT will also serve as the National Appellate Authority for Advance Ruling.
Simplified GST registration Scheme:Small and low-risk businesses
- Under this proposed scheme which would get operationalised from 1 November 2025, low risk applicants and applications whose output tax liability does not exceed 2.5 Lakh per month (including CGST, SGST/UTGST and IGST), shall be granted registration automatically within 3 days from the date of submission of application
- Opting in and withdrawal under said scheme would be voluntarily
Small suppliers supplying through an e-commerce operator (ECO)
In order to simplify the registration scheme for small suppliers supplying through ECO across multiple States, an operational model would be decided.
Click here to check the recommendations made in the 56th GST Council Meeting
Disclaimer: This article provides general information existing at the time of preparation and we take no responsibility to update it with the subsequent changes in the law. The article is intended as a news update and Affluence Advisory neither assumes nor accepts any responsibility for any loss arising to any person acting or refraining from acting as a result of any material contained in this article. It is recommended that professional advice be taken based on specific facts and circumstances. This article does not substitute the need to refer to the original pronouncement.
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