Take a look at the essential events, concepts, terms, quotes, or phenomena every day and brush up your knowledge. Here’s your UPSC Current Affairs knowledge nugget for today on theGoods and Services Tax Council. The 57th Goods and Services Tax (GST) Council meeting was held on October 8, 2026, at Bharat Mandapam in New Delhi, under the chairmanship of Union Finance Minister Nirmala Sitharaman.1. In a bid to boost business sentiment, the Council approved sweeping process reforms, ranging from the removal of arrest powers from tax officers at the pre-prosecution stage to a minimum threshold of Rs 10,000 being put in place for issuance of show-cause notices effective retrospectively.2. Union Finance Minister Nirmala Sitharaman said that the processes must be such that businesses are “trusted”, and these should not be “too intrusive”.3. Tough punitive measures under the GST law had become a major hurdle for business sentiment with industry groups often complaining of overreach by tax authorities.4. The Council recommendations will come into force from April 1, 2027.What are the key decisions taken in 57th GST council meeting?5. For intentional frauds and deceit under GST, the authorities will proceed with prosecution and arrests will be through the country’s criminal code, Bharatiya Nyaya Sanhita, a source said.6. Explaining the Council’s decision, Sitharaman said the power to arrest has been taken away from tax officers, and only criminality should lead to prosecution. Story continues below this ad7. Under the Central GST Act, non-compliance can result in penalty under Section 122, interest under Section 50, and recovery of tax. However, violations involving deliberate intent to evade tax attract arrest and prosecution under the criminal provisions of the CGST Act.8. Aimed at decriminalisation, process reforms, compliance, and ease of doing business, the decisions of the Council also raised the threshold for prosecution from Rs 1 crore to Rs 5 crore “with a view to further strengthening a progressive and trust-based tax regime, while retaining effective deterrence against fraud and evasion”.9. In another big move, the Council has ruled that vehicles carrying goods can only be stopped by tax officers from either the state of the supplier or the recipient, and only on the basis of “specific intelligence” and due authorisation.10. The Council has also recommended that the maximum general penalty be reduced from Rs 25,000 to Rs 10,000, with a lower penalty of 5% as well as removal of the condition of minimum penalty of Rs 10,000 in non-fraud cases.Story continues below this ad11. In another decision, the Council gave relief to taxpayers who file late, make mistakes, or fall behind on payments, saying that they will only face recovery, interest, and a proportionate penalty.12. The ambit of refunds has also been widened to include input services under the inverted rate structure and capital goods. 13. This step is expected to help free up more working capital for companies, including fast-moving consumer goods (FMCG) entities that deal with higher inverted duty refunds.14. The refund of input tax credit on capital goods will be spread over 60 months. While the change for capital goods will come into effect from April next year, that for input services can be availed from November 1, 2026, Sitharaman said.Story continues below this ad15. Deeper data analytics, leveraging technology, moving away from enforcement-led and intrusive actions, tracking taxpayers who do not pay tax in cash and using invoice matching are among the measures that central and state officers have been asked to focus on to deepen the tax base under the Goods and Services Tax (GST) regime.What is the GST Council?1. The GST regime came into force through the 101st Constitutional Amendment Act after the Constitutional (122nd Amendment) Bill was passed by both Houses of Parliament in 2016. 2. More than 15 Indian states then ratified it in their state Assemblies, after which then-President Pranab Mukherjee gave his assent.3. It came into effect in 2017 and was billed as an attempt to simplify the existing tax structure in India, where both the Centre and states levied multiple taxes, and to make it uniform.Story continues below this ad4. As per Article 279A (1) of the amended Constitution, the GST Council has to be constituted by the President within 60 days of the commencement of Article 279A. 5. According to Article 279A, the GST Council shall consist of the Union Finance Minister (chairman) and Ministry of State in charge of Revenue; the Minister in charge of Finance or Taxation, or any other Minister, nominated by each state.6. The Council, according to Article 279, is meant to “make recommendations to the Union and the states on important issues related to GST, like the goods and services that may be subjected or exempted from GST, model GST Laws”.7. It also decides on various rate slabs of GST, whether they need to be modified for certain product categories, and so on.Story continues below this ad8. The decision within the Council is ought to be made by three-fourths majority of votes cast; Centre shall have a third of votes cast, states shall together have two-thirds. The mechanism for resolving disputes arising out of its recommendations may be decided by the Council itself.9. For instance, an interim report by a panel of ministers has suggested imposing 28 per cent GST on casinos, online gaming and horse racing. A decision on this will be taken at the Council meeting on Wednesday.10. Article 279 A (5) of the Constitution prescribes that the GST Council shall recommend the date on which the goods and services tax be levied on petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural gas and aviation turbine fuel (ATF), also as per the Section 9(2) of the CGST Act, inclusion of these products in GST will require recommendation of the GST Council. Alcoholic liquor for human consumption as per Article 366(12A) are also excluded from the GST regime.BEYOND THE NUGGET: Key reforms under GST 2.01. Tax slab rationalization merges and collapses the previous four consumer tax slabs (5%, 12%, 18%, and 28%) into a simplified two-slab structure of 5% (merit rate) and 18% (standard rate). Story continues below this ad2. Retains/introduces specific rates such as 0.25% (rough/semi-precious stones), 3% (precious metals like gold and silver), 0% (nil slab for life-saving drugs, health/life insurance, basic food items), and a 40% demerit rate for luxury and sin goods (replacing the old 28% + cess structure). 3. Operationalizes the GST Appellate Tribunal (GSTAT) to fast-track dispute resolution and simplifies registration for low-risk businesses, with a Principal Bench and 31 State Benches. 4. Critical sectors have been exempted from taxation. Individual life and health insurance premiums are fully exempt from GST. Additionally, 33 life-saving drugs carry a 0% tax rate.5. Common food essentials including roti, paratha, khakhra, paneer, and Ultra-High Temperature (UHT) milk carry nil GST. Moreover, basic learning materials, notebooks, and stationery are GST-free. Story continues below this adPost Read QuestionsWhat is/are the most likely advantages of implementing ‘Goods and Services Tax (GST)’? (UPSC CSE 2017)1. It will replace multiple taxes collected by multiple authorities and will thus create a single market in India.2. It will drastically reduce the ‘Current Account Deficit’ of India and will enable it to increase its foreign exchange reserves.3. It will enormously increase the growth and size of the economy of India and will enable it to overtake China in the near future.Select the correct answer using the code given below:(a) 1 only(b) 2 and 3 only(c) 1 and 3 only(d) 1, 2 and 3Answer: (a)Previous year UPSC Mains Question Covering similar theme:Explain the rationale behind the Goods and Services Tax (Compensation to States) Act of 2017. How has COVID-19 impacted the GST compensation fund and created new federal tensions? (UPSC, GS3, 2020)(Sources: GST arrest powers dropped, prosecution threshold raised in key reform, GST arrest powers on way out amid concerns over taxmen’s overreach, As GST 2.0 kicks in, what changes for consumers and industry?, Explained: What is the GST Council, and what does it do?)