GST Council’s 56th Meet introduces Key Slab Reforms and Tribunal Rollout

On 3-9-2025, the Goods and Services Tax Council (‘GST Council’) held the 56th GST Council meeting chaired by Union Finance & Corporate Affairs Minister Smt. Nirmala Sitharaman, marking a transformative moment in India’s tax landscape. The Council unveiled a multi-sectoral reform agenda aimed at enhancing transparency, simplifying compliance, and promoting ease of doing business, especially for small traders and entrepreneurs. The revised GST rates will come into effect from 22-09-2025. Tobacco product rates will be notified separately due to pending cess issues.

Key Highlights of GST Council 56th Meeting:

1. The Council’s recommendations encompassed revisions in GST rates for goods and services, procedural reforms, and institutional enhancements, all designed to make the GST framework more transparent, equitable, and business-friendly.
2. In terms of goods, the Council proposed significant revisions to GST rates, with detailed changes outlined in Annexure-I (HSN-wise) and Annexure-II (sector-wise). These adjustments are expected to rationalize the tax burden across industries and align rates with consumption patterns and economic priorities.
3. The Council decided to levy GST on the Retail Sale Price (‘RSP’) rather than the transaction value for products such as pan masala, gutkha, cigarettes, unmanufactured tobacco, and chewing tobacco like zarda, aimed at curbing under-invoicing and ensuring more accurate tax collection.
4. An ad hoc IGST and compensation cess exemption has been granted for the import of a new armoured sedan car by the President’s Secretariat, exclusively for the President of India.
5. The Council recommended a series of rate changes, with specifics provided in Annexure-III (HSN-wise) and Annexure-IV (sector-wise), designed to simplify compliance and bring greater uniformity to service taxation.
6. One of the key clarifications issued pertains to the definition of ‘specified premises’ in the context of restaurant services.
7. The Council emphasized that stand-alone restaurants cannot classify themselves as ‘specified premises’ and therefore are not eligible to pay GST at the rate of 18% with input tax credit (ITC). This clarification aims to eliminate ambiguity and ensure consistent tax treatment across the hospitality sector.
8. The Council recommended amendments to the GST valuation rules to align them with the revised tax rate applicable to lottery tickets, thereby enhancing procedural coherence and reducing interpretational disputes.
9. To ensure a seamless transition and uphold fiscal prudence, the GST Council adopted a phased rollout of the proposed reforms. The first phase, effective 22-9-2025, will implement: GST rate changes on services, and GST rate changes on goods, excluding tobacco and pan masala products.
10. CBIC will begin administrative implementation of 90% provisional refunds for inverted duty structures using data analytics and risk evaluation, pending legislative amendments.
11. The Council also focused on measures to facilitate trade and improve the ease of doing business.
12. A major institutional reform announced during the meeting was the operationalization of the Goods and Services Tax Appellate Tribunal (GSTAT). The Tribunal will begin accepting appeals by the end of September 2025 and commence hearings by December 2025.
13. The Council has set a deadline of 30-6-2026 for filing pending cases, to address the backlog of appeals.
14. The Principal Bench of the GSTAT will also serve as the National Appellate Authority for Advance Ruling, thereby ensuring consistency in rulings and providing greater legal certainty to taxpayers
15. Overall, the 56th GST Council meeting reflects a strategic recalibration of India’s GST framework, aligning it with evolving economic conditions and stakeholder needs.

Source : https://www.scconline.com/blog/post/2025/09/04/gst-council-56th-meeting-slab-reforms-tribunal-rollouts-2025/