The Indian government has unveiled a Simplified GST Registration Scheme aimed at easing compliance for small and low-risk businesses. Under this initiative, eligible applicants can now obtain GST registration within three working days, significantly reducing waiting times and paperwork. Businesses are identified as low-risk through data analysis and by assessing risk parameters. Firms that do not claim an input tax credit (ITC) of more than ₹2.5 lakh per month can also opt for this streamlined registration process.
The Central Board of Indirect Taxes and Customs (CBIC) stated that the scheme is designed to accelerate entrepreneurship, simplify compliance, and support a smooth start for new business ventures. Businesses wishing to withdraw from this scheme can still follow the regular registration procedure. The reform is expected to benefit approximately 96% of fresh applicants, making GST registration faster, simpler, and more convenient.
In addition to registration reforms, the government introduced major GST rate rationalisations under the Next-Generation GST initiative. The existing four slabs have been reduced to two main rates – 5% and 18%, with a higher 40% slab for luxury and sin goods such as tobacco. Essentials like hair oil, soaps, toothpaste, bicycles, kitchenware, milk, paneer, and bread have seen significant reductions, while certain food items, including sauces, noodles, butter, and ghee, now attract just 5% GST.
Finance Minister Nirmala Sitharaman emphasized that the reforms aim not only to lower rates but also to reduce compliance burdens, improve predictability, and simplify refunds, return filing, and registration. Prime Minister Narendra Modi highlighted that the changes will support MSMEs, small vendors, farmers, and the middle class, aligning with his vision of a citizen-friendly and growth-oriented economy ahead of Diwali. These measures are expected to strengthen entrepreneurship, ease household budgets, and enhance India’s ease of doing business.
