Finance Minister Nirmala Sitharaman presented her record 9th consecutive Union Budget 2026-27 today (on February 1, 2026). Key highlights of Indirect tax – GST proposals are as under:
Provisional Changes:
From April 1, 2026, changes have been made in sub-section (3) of section 15 of the CGST Act, to remove the requirement of establishing the discount through an agreement as well as linking the post-sale discount to the relevant invoices. Further, the section requires the issuance of credit note by the supplier under section 34 and mandatory reversal of input tax credit by the recipient. This reduces documentation and compliance burden, provides greater flexibility in offering discounts after sale
Amendments in Section 34 also proposed in line with the changes of section 15(3) for issuing credit notes for post-supply discounts.
Changes in sub-section (6) of section 54 of the Central Goods and Services Tax Act to extend the provisions of provisional refund to refunds arising out of inverted duty structure.
Provisional Refund:- In case of any claim for refund made by registered persons on account of zero rated supply of goods or services (Other than notified categories) or on account of Input Tax Credit accumulated due to inverted duty structure, refund on a provisional basis to be granted to the extent of ninety per cent. of the total amount so claimed.
Amendment in sub-section (14) of section 54 of the Central Goods and Services Tax Act to provide for removing the threshold limit of One Thousand Rupees for claim of refund in case of goods exported out of India with payment of tax.
A new sub-section (1A) in section 101A of the Central Goods and Services Tax Act so as to provide that till the National Appellate Authority is constituted under sub-section (1), the Government may on the recommendation of the Council, by notification, empower any existing Authority to hear appeals made under section 101B.
It further seeks to provide that in such case, the provisions of sub-sections (2) to (13) shall not apply.
It also seeks to insert an Explanation in the said sub-section so as to provide that the expression “existing Authority” shall include a Tribunal.
Amendment proposed to omit clause (b) of sub-section (8) of section 13 of the Integrated Goods and Services Tax Act, 2017 so as to provide that the place of supply for “intermediary services” shall be determined as per the provisions of sub-section (2) of section 13 of the said Act, which is the location of the recipient of such services. Clause (b) of Section 13(8) of IGST ACT earlier provided that the place of supply of intermediary Services shall be the location of the supplier of services.
NOTE: – This article is for information only. All the proposals shall be given effect only after the same has been notified by the CBIC (Central Board of Indirect taxes & Customs) through Notifications/Circulars in the Official Gazette.
