CBIC Chief Tells Tax Officers to Handhold Trade and Industry for Smooth Navigation of GST Rates

New Delhi: Central Board of Indirect Taxes and Customs (CBIC) chairman Sanjay Kumar Agarwal urged industry to navigate the transition smoothly soon after the implementation of new GST rates. “Proactive outreach and effective interactions will be crucial to ensure that taxpayers clearly understand the revised tax rates and compliance simplifications,” the CBIC chief said.

In the new rate slabs (5 & 18 per cent), the government has approved the reduced GST rates on 375 items, with a special rate of 40 per cent on tobacco and related products and ultra-luxury items, which are slated to be effective from September 22. However, Agarwal has underlined the need for ‘proactive outreach’ by tax officers to handhold trade and industry in navigating the transition smoothly.

As per the announcement made by Union finance minister Nirmala Sitharaman, the new rates would be effective September 22, barring tobacco and related products, which would continue to be taxed at 28 per cent plus a compensation cess till December 31. “A greater awareness will not only minimise confusion but also enable businesses, particularly small traders and MSMEs, to adapt seamlessly and fully benefit from the reforms,” he said in his weekly newsletter to tax officers.

In the newsletter, Agarwal also said that lower tax incidence on common man essentials will reduce household expenses, while affordable inputs for farmers, artisans, and manufacturers will boost production, employment and exports. “These reforms are not just about rate cuts - they represent a paradigm shift towards a fairer and more citizen-centric tax framework,” he said.

“As these transformative reforms take effect, the need of the hour is to handhold the trade and industry in navigating the transition smoothly. Proactive outreach and effective interactions will be crucial to ensure that taxpayers clearly understand the revised tax rates and compliance simplifications,” Agarwal wrote in the letter.

In the last GST Council meeting, it also decided to start a simplified GST Registration scheme for small and low-risk businesses from November 1. Under the optional simplified GST registration scheme, registration shall be granted on an automated basis within three working days from the date of submission of application in case of low risk applicants and applicants who based on their own assessment, determine that their output tax liability on supplies to registered persons will not exceed Rs 2.5 lakh per month (inclusive of CGST, SGST/UTGST and IGST).