57th GST Council Reforms: Focus Shifts to Putting Them into Practice with the States
The 57th GST Council meeting was held on 8 October 2026. A senior official of the Department of Revenue, Ministry of Finance, said its recommendations came out of wide consultation within the government and with the states.
The Centre will now focus on implementing the recommendations and will work with state tax departments so that they are applied the same way everywhere. Training programmes have started, and progress is tracked through management information systems.
On demands to scrap e-way bills, a working group of central and state officers found that e-way bill data is useful for logistics planning and for fast economic estimates by the Reserve Bank of India and statistical bodies. Instead of scrapping it, the reforms limit arbitrary stopping of goods vehicles: officers will need specific intelligence and approval from an officer not below Joint Commissioner rank, and checks in transit states will be restricted.
On Section 16(2)(c) of the GST law, which links a buyer's input tax credit to the supplier actually paying the tax, the Council referred the issue to an officers' committee, which must report within three months. Genuine taxpayers who followed the law should not suffer.
Wider reforms aim to simplify registration, refunds, dispute resolution and cancellation. Taxable supplies grew about 26% in the period reviewed, and GST revenue grew about 15% in the second quarter.
A Bengaluru industry chamber said 7 of its 13 suggestions were considered by the Council, including allowing input tax credit on employee insurance and removing interest on reversed credit.
The GST Council (Article 279A)
The GST Council is a body of the Union Finance Minister and the finance ministers of all states. It recommends the main rules of the Goods and Services Tax (GST): tax rates, exemptions, thresholds and procedures. It was created by Article 279A, added to the Constitution by the 101st Constitutional Amendment Act, 2016. It is the main forum where the Centre and the states make tax decisions together.
The 57th Council has made its recommendations. As this news shows, the hard part now is turning them into amended laws and rules, and making sure every state applies them the same way. That is the cooperative federalism the Council was built for.
Input Tax Credit (ITC) Mechanism Under GST
Input Tax Credit (ITC) is the heart of GST. When a business buys raw materials or services, it pays GST on them. When it sells its own product, it can subtract the GST it already paid on purchases from the GST it collects on sales. It pays the government only the difference. This removes "tax on tax" (the cascading effect) across the supply chain.
The Council sent the Section 16(2)(c) problem to an officers' committee with a three-month deadline. Industry's demand to allow ITC on employee insurance is about loosening Section 17(5). Both decide how much tax honest businesses finally pay.
E-Way Bill: How GST Tracks the Movement of Goods
An e-way bill (electronic way bill) is a digital document that must be created on a government portal before goods worth more than ₹50,000 are moved from one place to another. It records what is being moved, by whom, from where and to where. Tax officers can check it on the road to make sure the goods are not moving without GST being paid.
Industry wanted e-way bills removed because of harassment on highways. The government chose to keep the e-way bill for its data value but to restrict when officers can stop vehicles, aiming to protect honest transporters while still catching tax evasion.
- 57th GST Council meeting: 8 October 2026
- Vehicle interception: needs specific intelligence and approval of an officer not below Joint Commissioner rank
- Section 16(2)(c) CGST Act: referred to an officers' committee; report due within 3 months
- Growth in taxable supplies: about 26% (year-on-year, period reviewed)
- GST revenue growth in Q2: about 15%
- Industry chamber: 7 of 13 recommendations considered by the Council
- GST Council: Article 279A; 101st Amendment Act, 2016; three-fourths weighted majority (Centre one-third, states two-thirds)