Odisha Pushes MSME-Friendly GST Reforms at 57th Council Meet

The 57th Goods and Services Tax (GST) Council meeting, chaired by Union Finance Minister Nirmala Sitharaman in New Delhi on 8 October 2026, considered a series of measures to make tax administration simpler, faster and more predictable for businesses. Ministers and senior officials from states and Union Territories participated in the deliberations.

Representing Odisha Chief Minister Mohan Charan Majhi, Cabinet Minister Prithviraj Harichandan outlined the state’s priorities on compliance relief and process improvements. The discussions were linked to the broader objective of supporting economic growth and advancing the Viksit Bharat 2047 vision, with particular attention to small businesses and exporters.

A central proposal involved system-based processing and sanction of refunds, which would provide genuine taxpayers with faster access to funds and clearer visibility over applications. The Council also considered refund of input tax credit on capital goods used for zero-rated supplies, along with input tax credit on input services and capital goods under the inverted duty structure. These measures would help release working capital for exporters and manufacturers.

Registration simplification was another key area of discussion. Clearer guidelines and practical tools are intended to help businesses in rural and semi-urban areas complete registration with fewer difficulties. Recommendations from the Working Group on GST Returns and Processes, in which Odisha’s State GST team participated, also covered return filing and an alternative mechanism for correcting liabilities and input tax credit claims. The proposed changes aim to reduce mismatches that can lead to avoidable notices.

Odisha officials additionally contributed to process-based refund reforms through the GST Law Committee. The Council considered removing arrest provisions for economic offences that can be addressed under existing GST law, seeking a more clearly defined balance between enforcement and taxpayer confidence. Taken together, the proposals are intended to reduce procedural friction for MSMEs and allow owners to devote more time to operations, investment and expansion. The deliberations indicate a continuing effort to create a more transparent and responsive GST framework.

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