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As of October 4, 2026, two different GST measures are under discussion: the GST Council has given in-principle approval to a simplified registration mechanism for small suppliers selling through e-commerce operators, while a separate proposal to protect buyers’ input tax credit (ITC) when suppliers default has reportedly cleared a law committee but still awaits a Council decision. Neither should be treated as a change to current filing obligations until the relevant details and legal instruments are issued.
What the proposed changes would do
| Measure | Who it concerns | Status reported as of October 4, 2026 | What is known |
|---|---|---|---|
| Simplified GST registration | Small suppliers selling through e-commerce operators across multiple states | In-principle approval recorded in the official recommendations from the 56th GST Council meeting | The detailed operating modalities were to be placed before the Council; the final process is not specified in the recommendation. |
| Buyer ITC protection for supplier default | Buyers claiming credit on purchases from suppliers who default | Economic Times reported on July 10, 2026, that a law committee had cleared a proposal; the Council still had to decide | The report described conditions involving invoice reflection in GSTR-2B and evidence of payment, including the GST component. |
These are separate proposals with different evidence and status. The Council’s official release explains that recommendations take effect through relevant circulars, notifications or amendments to law; those instruments, rather than a recommendation alone, have the force of law. See the 56th GST Council meeting recommendations.
Will small online sellers need GST registration in every state?
The official recommendation addresses the difficulty small suppliers can face in maintaining a principal place of business in every state where they sell through e-commerce operators. The Council gave in-principle approval to a simplified registration mechanism for these suppliers across multiple states.
That approval is not a complete, ready-to-use registration route. The release says detailed modalities for operating the scheme would be placed before the Council. It does not set out the final process or establish that sellers can already rely on a new exemption or registration procedure. Sellers should continue to follow the requirements currently applicable to them unless and until implementing details and legal instruments change them.
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Can a buyer claim ITC if the supplier does not pay GST?
Economic Times reported on July 10, 2026, that a proposal cleared by the GST law committee would protect a buyer’s ITC where the supplier had reported the invoice so it appeared in the buyer’s GSTR-2B, and the buyer could establish payment—including the GST component—through banking channels or other prescribed payment documents. According to that report, authorities would pursue the defaulting supplier rather than deny credit to a buyer who met the proposed conditions.
This is a reported proposal, not confirmed enacted law. The report said the GST Council still had to make the final decision. It does not establish that buyers can currently claim or retain credit solely by meeting those described conditions. Do not change an ITC claim or dispute position on the basis of the report alone; check for a Council decision and the implementing legal instrument. Read the July 10 Economic Times report on the buyer-ITC proposal.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.What was the expected Council timeline?
On September 7, 2026, ETCFO reported that the 57th GST Council meeting was scheduled for October 7 and was likely to consider compliance simplification, including registration and ITC matters. That date and likely agenda were reported by the outlet; they were not independently confirmed by an official notice in the sources available for this update, and no meeting outcome was available as of October 4.
An earlier Economic Times report on August 29 gave a September 12 meeting date. The later reported schedule is October 7, but readers should check official Council announcements for confirmation or any subsequent change. See ETCFO’s September 7 report on the expected meeting and Economic Times’ August 29 report on the earlier date.
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What sellers and buyers should verify before changing practice
- For e-commerce suppliers: look for the final registration modalities and any notification, circular or law amendment that implements them. The in-principle recommendation alone does not tell you how to register or whether your circumstances qualify.
- For buyers claiming ITC: verify whether the Council adopted the reported supplier-default proposal, the final eligibility conditions, and the implementing legal instrument. The reported GSTR-2B and payment-evidence conditions are not, by themselves, confirmation of a current entitlement.
- For both: continue following applicable filing and documentation requirements until the relevant official instruments establish a change.
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