GST Changes From 1 November 2026: What Small Businesses, Traders and E-Commerce Sellers Must Do Now

GST | RegisCorp Team

Short answer: A set of GST rate, exemption and procedure notifications issued at the end of October 2026 took effect on 1 November 2026. The ones most likely to touch a small business are: reverse charge, registration and 2% GST TDS for scrap, used cooking oil, plastic waste, tyre waste and e-waste; a 5% rate (without input tax credit) on delivery services booked through e-commerce operators; same-line credit rules for hotels, restaurants and outdoor catering; a nil rate on psyllium (isabgol) seeds; a lower 5% rate on retreaded tractor tyres; and an easier rule for post-sale discounts and credit notes. E-invoicing for reverse charge supplies is a separate change and is reported to start only on 1 January 2027.

How to read this post. The details below come from the 57th GST Council press release (8 October 2026), which is an official source, and from published summaries of the notifications dated 26 to 28 October 2026. We link the official portals at the end. Before you change an invoice, a rate or a return, read the notification itself on the CBIC website and apply it to your own facts. This is general information, not tax advice.

What happened, in plain words

On 8 October 2026 the 57th GST Council met in New Delhi and made a long list of recommendations. A Council recommendation does not change the law by itself. It becomes binding only when the Centre and the States issue notifications, circulars or law amendments. At the end of October 2026 a first group of those notifications was issued, and most took effect on 1 November 2026. Other items, such as the changes to returns and refunds, are expected to be rolled out later and in phases.

So there are three groups of changes, and mixing them up is the most common mistake right now:

1. In force from 1 November 2026 (rate and exemption notifications, scrap and e-waste rules, discount and refund wording).
2. Announced with a later date (for example, e-invoicing for reverse charge supplies, reported from 1 January 2027, and some registration rule changes from 1 December 2026, 1 January 2027 or 1 April 2027).
3. Recommended but not yet notified (the automatic refund and cancellation features, the Rs 10,000 minimum for show cause notices, lower penalties). Do not plan around these as if they were law.

Change 1: Scrap, used cooking oil, plastic, tyre waste and e-waste

Since October 2024, metal scrap has been under three linked rules: the buyer pays GST under reverse charge when buying from an unregistered seller, the seller must register even if all of the seller's supplies are under reverse charge, and registered buyers deduct 2% GST TDS on purchases above the contract threshold. From 1 November 2026 the same framework is reported to extend to:

• used cooking oil,
• plastic waste and scrap,
• tyre waste and scrap, and
• e-waste.

What it means for a small business

• If you buy such material from unregistered sellers: you must pay GST on reverse charge. Ask for invoices and keep a self-invoice and payment voucher file for each purchase.
• If you sell such material: registration is mandatory even if you were below the usual turnover limit, because your supplies fall in the special list. Check with your GST adviser whether the turnover threshold you were relying on still protects you.
• If you are a registered buyer buying from a registered seller above Rs 2.5 lakh contract value: you are expected to deduct 2% GST TDS (1% CGST plus 1% SGST, or 2% IGST), register as a tax deductor if you are not one already, file the monthly TDS return by the 10th of the next month, and give the seller a TDS certificate. The seller sees the amount in the electronic cash ledger and can use it to pay GST.

Practical steps this week

1. List every product you buy or sell that falls in the new categories.
2. Check whether each supplier is registered. Update the vendor master.
3. Switch on the reverse charge flag for unregistered purchases in your accounting software.
4. If you must deduct TDS, apply for registration as a deductor and set a calendar reminder for the 10th.

Change 2: Delivery services through e-commerce platforms

Until October 2026, GST on delivery services was treated differently depending on whether the delivery was local. From 1 November 2026 the reported position is:

• Delivery services supplied through an e-commerce operator (other than postal and courier services) are taxed at 5% without input tax credit.
• The e-commerce operator pays the tax on these services under the special provision for operators (Section 9(5)), and the rule is no longer limited to local delivery.
• The exemption for goods transport agency services no longer covers goods sold through e-commerce operators.

Who is affected: delivery partners and gig-delivery businesses, small logistics firms that deliver for marketplaces, and sellers who ship through marketplace-linked partners.

What to do: if you invoice a marketplace or a platform for delivery, confirm the rate and who is paying the tax before you issue November invoices. Because credit is not available at 5%, the cost will not be recoverable by the platform as input tax credit, so expect a conversation about pricing.

Change 3: Hotels, restaurants, outdoor catering and electric vehicles

For several services, the November change is mostly about the credit condition rather than the headline rate.

What "same-line credit" means. You can claim input tax credit only on services you buy from another supplier of the same kind of service (for example, a restaurant claiming credit on outdoor catering services bought from another caterer), not on general inputs such as equipment or rent. If you run a restaurant, a small hotel or a catering business, review your credit claims in GSTR-3B for November and ask your accountant to document the basis.

Change 4: Cab hire with fuel for a company

For cab hire where the fuel cost is included and the customer is a body corporate, the reported change is that reverse charge applies unless the supplier charges CGST at 9% (that is 18% in total). The earlier rate was 6% CGST. If you rent cabs for staff, check your vendor invoices. If you operate cabs and serve companies, decide whether to move to 18% or to let customers pay under reverse charge.

Change 5: Nil rate on psyllium seeds and 5% on retreaded tractor tyres

• Psyllium (isabgol) seeds are reported to become exempt (nil rate) whether fresh, chilled, frozen or dried. Earlier, dried or frozen seeds attracted 5%.
• Retreaded tractor tyres move from 18% to 5%, aligning with new tractor tyres.
• Seaweed-extract bio-stimulants under the Fertiliser Control Order are clarified to fall under the fertiliser entry at 5%.

If you sell any of these, update your item master and the HSN-wise rate in your billing software before the next invoice.

Change 6: New exemptions

The notifications are reported to add or widen exemptions for:

• storage and warehousing of seeds meant for sowing,
• coffee curing services supplied to coffee cultivators,
• services by the Seamen's Provident Fund Organisation to its members,
• grant of toll rights by the Centre, a State, a local authority or a government entity,
• seat-share helicopter travel to or from the North-Eastern States, Sikkim and Bagdogra, and
• a related import-of-services exemption for Indian establishments of foreign shipping companies when provided by a related person without consideration.

If you offer any of these services, review whether you have been charging GST and whether you need to stop charging it from 1 November.

Change 7: Post-sale discounts, credit notes and refunds

One of the most useful changes for ordinary traders is the amendment to the rules on post-supply discounts. Under the earlier rule, a discount given after the sale reduced your taxable value only if it was agreed before or at the time of supply and was linked to the invoice. The reported change in force from 1 November 2026 is that a credit note, together with the buyer's reversal of the credit, is enough, and a prior agreement is no longer a precondition. Refund provisions in Section 54 were also amended.

What to do

1. Keep a written record of the discount or incentive scheme anyway.
2. Issue the credit note on time and make sure your buyer reverses the matching input tax credit.
3. Reflect it in the right return period. The time limit linked to Section 16(4) still matters.
4. Do not claim a lower tax value without a credit note.

Change 8: Registration and return rules rolling out in phases

The Central Tax (Amendment) Rules, 2026 are reported to introduce a new rule for small suppliers selling goods through e-commerce operators in states where they have no physical presence (new Rule 14B), replace registration rules 19 to 21, and move the GSTR-5 due date to the 13th for non-resident taxable persons. Different parts apply from 1 November 2026, 1 December 2026, 1 January 2027 or 1 April 2027. The sources we reviewed do not tell us which part starts when, so read the notification before relying on a given date.

The 57th GST Council also recommended, but has not yet brought into force, several improvements that small businesses will like. Treat them as announcements:

• a revised GST REG-01 with drop-down document selection and a circular listing required documents;
• automatic acceptance of cancellation applications once returns are filed and dues paid, starting with taxpayers who passed on credit of Rs 2.5 lakh or less in every month;
• late fee waiver for delayed GSTR-3B under Section 39(1) for taxpayers with prior-year turnover up to Rs 5 crore, if filed by the end of the month in which they were due;
• a Rs 10,000 minimum for show cause notices, a reduced 5% penalty in non-fraud cases if tax and interest are paid within 30 or 60 days of the order, and a lower cap on the general penalty;
• an optional annual return with quarterly payment scheme for B2C-only suppliers with turnover up to Rs 5 crore;
• automatic refund features, with provisional sanction of 90% of zero-rated and inverted-duty claims.

What did not change

• Late fees and interest rates remain as before.
• The general e-invoicing turnover limit of Rs 5 crore is unchanged. The new e-invoicing for reverse charge supplies and import of services is reported to start on 1 January 2027, not 1 November.
• The due dates for November returns are as usual: GSTR-1 on the 11th for monthly filers, GSTR-3B on the 20th, and the QRMP payment on the 25th.

A simple checklist for November 2026

1. Check your product list against the new rates and exemptions. Update HSN codes and rates.
2. Check your services if you run a hotel, restaurant, caterer, EV operator, cab business or logistics firm.
3. Look at your vendors. Are they registered? Do you need to deduct TDS or pay reverse charge?
4. Review your credit notes and discount schemes.
5. Fix your invoice templates: correct rate, correct legend for reverse charge, and the right supplier details.
6. Calendar the dates: TDS return on the 10th, GSTR-1 on the 11th, GSTR-3B on the 20th.
7. Keep copies of the notifications you rely on in your compliance folder.

Frequently asked questions

Does a Council recommendation change my GST right away? No. A recommendation takes effect only through a notification, circular or amendment. Check the CBIC and GST portals.

I sell scrap and my turnover is small. Do I still need registration? The reported notification makes registration mandatory for suppliers of the listed goods even if all supplies are under reverse charge. Confirm with your adviser, because the details depend on how you supply.

Who deducts 2% GST TDS? A registered buyer who purchases the listed goods from a registered seller where the contract value exceeds the threshold (reported as Rs 2.5 lakh). The buyer needs to be registered as a tax deductor.

Can a hotel claim full input tax credit at 5%? Not for the new 5% option. Credit is limited to the same line of service, and for hotels and outdoor catering it is reported to be capped at 2.5%.

Are delivery partners affected? The tax applies to the delivery service supplied through the platform. Whether a person must register depends on the turnover and the place of supply. Ask your adviser.

What should I do about invoices issued on or after 1 November at the old rate? Issue a correct invoice or a credit note and debit note as needed, and consider the time-of-supply rule in Section 14 for transitions. Document the decision.

How RegisCorp can help

If you want a quick review of how the November changes affect your invoices, vendors and returns, our team can map your products and services to the new rules, set up reverse charge and TDS workflows, and prepare your November returns. Write to us through the contact page or message us on WhatsApp.

Official sources

• GST Council press release on the 57th meeting, 8 October 2026: gstcouncil.gov.in
• CBIC notifications and circulars: cbic.gov.in
• GST portal news and updates: gst.gov.in

Last updated 3 November 2026. Rules change often. Verify every rate and date against the notification before you act.