The GST Council has approved a proposal to protect buyers' input tax credit from supplier defaults, ensuring that buyers are not penalized if suppliers fail to deposit taxes, provided invoices are reported and payments are made through banking channels.
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Key takeaway
GST Council approves proposal to protect buyer's input tax credit from supplier defaults.
- Step 1 · The triggerGST Council approves ITC protection for buyers on supplier default.
- Step 2 · Knock-onSMEs' working capital improves as ITC claims become more certain, reducing the need for bridging finance.
- Step 3 · Reaches youLower compliance burden and litigation risk for SMEs, encouraging formalization and better invoice discipline.
The trigger is reported by the source below. The steps that follow are Branch²’s traced reasoning — how the shock could reach a business like yours, not a prediction.
Source: Economic Times — Economy
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