

Budget 2026: Govt weighs easing GST compliance for small businesses
₹10 crore.In case of ‘genuine errors’ or delayed filings, the micro, small and medium enterprises (MSMEs) may first be issued a warning, and penalties could be waived for the first two such instances, said the first person mentioned above.Currently, under Section 47 of the CGST Act, a delay in filing GSTR-1, GSTR-3B, or GSTR-9 attracts a late fee, which increases daily until it reaches a maximum cap. An enterprise is also liable to pay interest at 18% per annum on the outstanding GST amount if the payment is delayed.India’s 73 million MSMEs contribute 30% to the GDP and 45% to the overall exports.
The proposed reforms, which follow a cut in GST rates in September this year, come at a time when small businesses have been hit by the steep US tariffs of 50%.Queries emailed to the Union ministries of finance and MSME on Friday remained unanswered until press time."Filing of taxes and other taxation-related compliances involves a lot of time and many a time requires a separate set of people to fulfil these requirements,” said Vinod Kumar, president at industry lobby India SME Forum. “For a micro enterprise which is not deep-pocketed and does not have a lot of manpower, this is a lot of hassle and many times the compliance cost comprises about 6-8% of a micro enterprise’s turnover."The GST regime also offers a composition scheme–a simplified, optional tax compliance system wherein there is no tax liability and return filing mandate.
Read on livemint.com