On 8 October 2026, the GST Council recommended a change for small online sellers who keep stock in other states. If the government makes it law, they won’t need an office of their own in each of those states.
Say you make ceramic mugs in Khurja, the pottery town in Uttar Pradesh. Most of your Amazon orders come from Bengaluru and Mumbai. So you send stock to Amazon’s warehouses in Karnataka and Maharashtra, close to those buyers. And every month, you pay rent for two offices where nobody works.
You pay that rent because of GST. The new rule is about exactly that.
Why sellers rent offices nobody works in
Under GST, a warehouse that holds your stock counts as a place of your business. So when Amazon keeps your mugs in Karnataka, you need a GST registration there. It’s separate from your registration in Uttar Pradesh.
Every registration needs a main address in that state, called the principal place of business. In practice, you can’t give the marketplace’s warehouse as that main address today. You can only add it later, as an extra place of business.
So sellers rent an address. A virtual office gives you an address in the state, with a rent agreement. It also gives you the other papers GST asks for as proof. You register with that address. Then you add Amazon’s warehouse to the registration, and upload the new certificate in Seller Central. Flipkart also wants its warehouse on your GST registration before it takes your stock.
When we onboard sellers who want stock in other states, this is the paperwork they go through. It works. But each new state means another rent agreement. And each one means another wait while an officer approves the warehouse address.
What the new rule changes
The Council recommended a new rule: rule 14B of the Central GST Rules. In a state where you have no premises, you’ll be able to use the marketplace’s warehouse as your main address. The marketplace has to agree, and your home state checks who you are. Then the GST portal grants the registration.
For the mug maker, that means two registrations, one in Karnataka and one in Maharashtra. Each one uses Amazon’s warehouse as the address. There are no rent agreements and no empty offices. The Finance Ministry’s press release says the rule will help small sellers expand to other states. They won’t have to “set up a place of business in each State”.
The same release makes a second change that helps. Apart from the main address, the portal will accept changes to a registration automatically. Once this is in force, adding another Amazon or Flipkart warehouse shouldn’t mean waiting for an officer. On the new route, though, the marketplace must agree to each warehouse you add.
Who can use it
The rule is for small sellers of goods who sell through marketplaces. The press release doesn’t measure “small” by your sales. The limit is on the GST you charge business buyers, which they can claim back. That GST can’t go above ₹2.5 lakh a month. Stock you send between your own registrations doesn’t count.
Most of the mug maker’s buyers are people buying for their homes. They can’t claim GST back. So the mug maker stays well within the limit.
Some news reports described the limit as ₹2.5 lakh of monthly sales. But the GST Council’s own FAQ agrees with the press release. The limit is on the tax on your sales to registered buyers.
The GST Council’s FAQ on the new rule adds a few more conditions:
- You need a regular GST registration and a real place of business in your home state. For the mug maker, that’s the workshop in Khurja.
- You can hold one such registration in each state.
- It covers only what you sell through marketplaces. It doesn’t cover sales to local shops or through your own website.
- The marketplace must agree to you using its warehouse. This isn’t automatic. If the marketplace doesn’t agree, you can’t use this route.
What stays the same
Each state is still a separate GST registration. Each one has its own returns, every month or every quarter. The new rule removes the need for an office. It doesn’t remove the returns your CA files for each state.
Moving your own stock from Khurja to Karnataka works as it does today. It’s a supply between two of your own registrations, so it needs a GST invoice. It also needs an e-way bill when the shipment is worth more than ₹50,000. Our FBA shipment checklist covers the rest of the paperwork for sending stock to Amazon.
Quick commerce is different. Blinkit buys stock from brands and keeps it in its own warehouses. So since September 2025, brands on Blinkit haven’t needed an extra place of business in each state. Our guide to Blinkit’s fill rate and seller tiers explains how that works. The new rule matters most for marketplace warehouses, like Amazon’s and Flipkart’s.
When it starts, and the steps
News reports from 22 and 23 October say the new route should open on the GST portal on 1 November 2026. But the government hadn’t notified the rule when we wrote this. So treat 1 November as the expected date, not a certain one.
The Council’s FAQ sets out the steps:
- You apply on the GST portal in form REG-01, and choose the new route (rule 14B). You give your GSTIN from your home state. You also give the address of the marketplace warehouse that will be your main address in the new state. Other warehouses of the same marketplace in that state go in as extra places of business.
- The portal sends your application to the marketplace. The marketplace has 7 working days to agree. If it doesn’t agree in time, the portal rejects your application.
- Once the marketplace agrees, a GST officer in your home state checks you. That means a biometric Aadhaar check, a photo, your original documents and a visit to your workplace. If your home state did these checks when you first registered, it won’t repeat them.
- After the checks, the portal grants the registration. Your certificate shows the marketplace warehouses and your home address.
You keep the accounts and records for each of these registrations at your workplace at home. If the marketplace later stops letting you use its warehouse, you get 30 days to change the address. If you don’t, the portal cancels the registration.
Until the government notifies the rule, you still need an address of your own in each state where you keep stock. If you need stock in Bengaluru before the new route opens, go the old way. If a new state can wait a few weeks, we’d wait for the rule. There’s no point paying rent for an office you may soon not need.
Use the time to get ready. Keep your home-state registration in order, because the new route needs a real workplace there. Look at where your orders come from. A nearby warehouse helps most in the states with the most orders. And ask your CA what the returns for each extra state will cost.
Where we come in
We onboard sellers on Amazon, Flipkart and the quick-commerce apps. We also help them keep stock in marketplace warehouses across states. So we know where first-time sellers get stuck. Sometimes a warehouse is missing from the GST certificate. Sometimes the officer won’t accept the rent agreement.
We plan which warehouses to use, and set up your listings and shipments. Your CA files the registrations and returns, and we work alongside them. Everything stays in your own seller account. See our marketplace onboarding work.
We’re not tax advisers. Once the rule is out, your CA should confirm whether you qualify for the new route. If you aren’t registered for GST yet, start with our guide to selling online without GST.
