The Goods and Services Tax (GST) Council has cleared a set of measures aimed at reducing the compliance load on businesses, reported NDTV on Wednesday.

Chief among these are a reduction in registration time for MSMEs and start-ups, from 30 days to just three, and the introduction of automated GST refunds for exporters.

The council has also moved to speed up relief for industry. Refunds stuck under the inverted duty structure in sectors such as textiles, pharmaceuticals, chemicals, and fertilisers will now be cleared in seven days, CNBC-TV18 reported.

These approvals came on the first day of the council’s two-day meeting, which began with rationalisation of tax slabs as the central item on the agenda.

Non-BJP ruled states have voiced concern over the potential Rs 50,000 crore revenue loss. Karnataka, Punjab, and West Bengal have asked for clear revenue loss estimates and guarantees of compensation, according to CNBC-TV18.

The council is examining a proposal to cut the existing four brackets, five, 12, 18, and 28 per cent, by half.

According to officials, the government intends to shift 90 per cent of goods from the 28 per cent slab to 18 per cent, and a portion from 12 per cent to five per cent.

The aim is to stimulate domestic consumption and balance an estimated Rs 50,000 crore revenue loss.

Eight sectors stand to benefit from the changes, textiles, fertiliser, renewable energy, automotive, handicrafts, agriculture, health, and insurance.

Proposals are also on the table to exempt some services from GST, including life and health insurance premiums, which are currently taxed at 18 per cent.

On the other end of the spectrum, so-called “sin goods” such as tobacco, high-end cars, and liquor will continue to face high taxation, with the addition of a proposed Health Cess or Green Energy Cess to replace the expiring Compensation Cess.

Officials pointed out that the rationalisation push comes after eight years of uneven revenue collection across the four slabs.

The government has argued that the middle class will gain from the move, with “daily use items” and “aspirational” goods likely to become more affordable.

Shifting items from 28 per cent to 18 per cent should, in theory, boost sales among price-sensitive consumers, which in turn could drive production and job creation in labour-intensive sectors like automobiles and consumer electronics.

The timing of these decisions is significant. With the United States imposing 50 per cent tariffs on Indian exports, worth an estimated $48 billion, last month, the government expects stronger domestic demand to cushion the impact.