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The GST Council is expected to consider a proposal to decriminalise offences under India’s indirect tax regime at a meeting reported for 7 October 2026, The Indian Express reported on 4 October. The report, citing two unnamed people aware of the development, says removing arrest provisions may be part of the proposal. No decision has been announced, and GST arrest powers have not been shown to have changed.
What is expected to be discussed?
The reported agenda is broadly described as decriminalising offences under the GST regime. The Indian Express says removal of arrest provisions is a possible part of the proposal, but it does not provide draft legal text, identify the specific offences that might be affected, or set out any proposed exceptions.
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The meeting plan and agenda are attributed to unnamed sources in the 4 October report. The GST Council’s meeting archive available for review did not list a 2026 meeting, so the reported date and agenda lack independent official confirmation in the sources reviewed.
Has GST law already been changed?
No change is established by the report. A Council discussion, or even a recommendation, is not itself proof that an offence or arrest power has been removed from the statute. The report says legislative changes would follow if the Council approves a proposal. Until any required statutory amendments are made, the reported discussion should not be treated as a change in the law.
Why is decriminalisation being considered?
The report presents the proposal against business concerns that arrest powers can be overused and disrupt businesses. It also recounts the tax administration rationale for retaining arrest powers as an enforcement tool. The policy question is therefore not simply whether GST violations should have consequences, but how to distinguish routine non-compliance from serious conduct while limiting the risk of disproportionate enforcement.
| Issue | Concern or rationale described in the reporting and earlier Council record |
|---|---|
| Arrest as an enforcement tool | The tax administration rationale described in the report is that arrest powers support enforcement. The report does not specify which offences or circumstances would remain subject to arrest under the proposal. |
| Risk of overreach | Business concerns cited in the report focus on possible overreach and disruption. The report does not quantify the scale of this concern. |
| Ordinary non-compliance and serious fraud | The current report does not set out how the proposal would distinguish these cases. The 2023 Council record separately documents debate about prosecution thresholds and bill trading, but does not establish the terms of the 2026 proposal. |
| Policy proposal and enforceable law | The Council may consider or recommend a policy change; legislative changes would still be needed, according to the report. |
What earlier GST Council discussions show
The Council’s 49th meeting, held in 2023, considered Law Committee proposals on prosecution and compounding under the Central Goods and Services Tax Act (CGST Act). The proposals included removing specified offences from prosecution, raising the monetary threshold for prosecution from ₹1 crore to ₹2 crore, and changing compounding amounts. State representatives objected to parts of the proposals, citing revenue concerns and bill trading. The record says the matter was deliberated; it does not show that these 2023 proposals define or settle the terms of the reported 2026 discussion.
During that meeting, the Tamil Nadu representative cited the following figures in arguing against raising the threshold. They are figures from that state intervention, not national totals or independently validated estimates:
| Figure cited | Attribution and qualification |
|---|---|
| 471 cases below ₹1 crore, with ₹222 crore in revenue implications | Cited by the Tamil Nadu representative at the 49th GST Council meeting in 2023. |
| 241 cases that could be prosecuted, with ₹350 crore in revenue implications if the threshold rose to ₹2 crore | Cited by the Tamil Nadu representative at the 49th GST Council meeting in 2023. |
What the GST Council can do
The GST Council is a constitutional body that recommends measures on GST implementation. Its role in considering or recommending a policy change is distinct from changing the law itself. For the reported proposal to alter statutory offences or arrest provisions, the legislative steps described by The Indian Express would still have to follow any Council approval.
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What remains unknown
- Whether a meeting will take place on 7 October 2026 and whether decriminalisation is on its confirmed agenda.
- Which offences, if any, the proposal would cover, and whether it would remove arrest powers, change prosecution rules, alter compounding provisions, or combine these measures.
- Whether the Council will recommend a change and what statutory amendments would be required.
- Any effective date. The report does not provide draft clauses or a timetable for changes to take effect.
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