Will the new 'simplified' GST registration scheme truly help small businesses?

The GST department has rolled out a new simplified registration scheme, promising GST registration within three working days for small and low-risk businesses. While the move is being hailed as a step towards improving ease of doing business, industry observers remain cautious, arguing that simplification on paper doesn’t always translate into ease in practice.

The scheme, which takes effect from today, allows small business applicants identified as low-risk through data analytics or those who self-assess a monthly output tax liability of up to Rs 2.5 lakh (inclusive of CGST, SGST/UTGST, and IGST) to opt for a faster approval process.

It was approved by the GST Council, comprising Union and state finance ministers, during its meeting on 3 September.

Finance Minister Nirmala Sitharaman, while inaugurating the CGST building in Ghaziabad, said that the scheme is expected to benefit 96 per cent of new applicants.

“The task of the field formation is to operationalise it and ensure that there are no frictions in the process,” she stated. The minister also directed the CBIC to set up dedicated help desks at GST Seva Kendras to guide taxpayers through registration.

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GST PORTAL MAJOR UPDATE:
The GST common portal has operationalized the simplified registration route that enables registration within 3 working days for eligible low-risk applicants (Aadhaar authentication mandatory). Applicants should ensure all prescribed documents are uploaded… pic.twitter.com/PvE5yTtNJD

— CA Himank Singla (@CAHimankSingla) November 1, 2025

However, tax experts and SME associations note that the real test will be in implementation. Despite multiple rounds of “simplification,” small and medium enterprises continue to face significant hurdles, from system glitches and data verification delays to inconsistent field-level interpretations.

Many fear that unless the backend processes are fully automated and accountability is strengthened, the promise of a three-day turnaround could remain aspirational.

Currently, over 1.54 crore businesses are registered under GST. Yet, compliance remains a sore point for SMEs, which often lack the resources or in-house expertise to manage the complexities of frequent rule changes, input tax credit reconciliations, and return filings.

While the government’s intention to streamline registration is commendable, the broader challenge of GST compliance continues to weigh heavily on entrepreneurs. For many, the issue is not just registration speed, but the recurring burden of navigating a tax system that still feels anything but “simple”.

The new scheme may be a step forward, but whether it meaningfully lightens the compliance load for India’s small businesses remains to be seen.

With PTI inputs