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India’s GST Decriminalization Reforms: What Changed and When

India’s GST reforms targeted three specified offences, raised the general prosecution threshold to ₹2 crore with an invoice-without-supply exception, and lowered the compounding range. They took effect on 1 May 2023, according to budget-era government material.
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India’s GST reforms narrowed criminal liability for certain offences, raised the general prosecution threshold from ₹1 crore to ₹2 crore, and reduced the stated compounding range. They did not decriminalize every GST offence. The Goods and Services Tax Council recommended the changes in December 2022; government budget-era material said they took effect on 1 May 2023.

What GST offences were decriminalized?

The GST Council recommended removing criminal penalties under section 132(1) of the Central Goods and Services Tax Act for three specified kinds of conduct:

  • Clause (g): obstructing or preventing an officer from discharging official duties.
  • Clause (j): tampering with or destroying material evidence or documents.
  • Clause (k): failing to supply required information or supplying false information.

This was a defined set of offences, not a blanket end to criminal enforcement under GST. Section 132 covers other punishable offences, and the Council’s recommendation did not remove them all. The Council’s agenda note and meeting minutes describe the proposed scope (48th GST Council meeting agenda; minutes of the 48th meeting).

How did the prosecution threshold change?

The Council recommended raising the general minimum tax amount for launching a prosecution from ₹1 crore to ₹2 crore. The higher threshold does not apply to the specified exception for issuing invoices without an actual supply of goods or services. It is therefore inaccurate to describe ₹2 crore as a universal threshold for every GST prosecution.

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How did compounding change?

The recommended compounding range fell from 50%–150% of the tax amount to 25%–100%. Compounding is a statutory route for resolving an eligible offence by paying an amount set by the Commissioner; it is not an automatic right or a general waiver. Section 138 of the CGST Act makes compounding subject to exclusions and requires payment of the tax, interest and penalty. On payment of the compounding amount, further proceedings under the Act for the same offence are not initiated, and criminal proceedings already initiated under the Act stand abated. Compounding does not affect proceedings under another law. See the CBIC text of the Central Goods and Services Tax Act.

When were the changes recommended and implemented?

  1. December 2022: At its 48th meeting, the GST Council recommended the specified decriminalization, threshold increase and lower compounding range. The Council’s recommendation was not itself the implementation date.
  2. 2023: The government presented the measures in the 2023 budget reform context. Budget-era government material stated that the changes took effect on 1 May 2023. The Press Information Bureau described the Council’s recommendations on 17 December 2022 (PIB release on the GST Council recommendations).

What does the 2026 Jan Vishwas Bill have to do with GST?

The Press Information Bureau reported that the Jan Vishwas (Amendment of Provisions) Bill, 2026, passed both Houses in April 2026. Its release described amendments to 784 provisions across 79 central Acts, with 717 provisions decriminalized. That is broad legislative context; the release does not identify a GST-specific amendment. It should not be treated as the source of the GST changes described above (PIB release on the Jan Vishwas Bill).

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What to check before relying on the rules

The CBIC Act page provides statutory wording but is not clearly identified as a current consolidated edition. For a current legal position or an individual matter, check the latest consolidated CGST Act, subsequent amendments and notifications, and the applicable State GST law. Eligibility for compounding and prosecution exposure depend on the facts and statutory exclusions; this overview is not case-specific legal advice.

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