Mumbai, May 3, 2018

RTI query filed by BusinessLine reveals the data

It may be less than a year since the Goods and Services Tax (GST) was rolled out, but unscrupulous businesses seem to have already found ways to evade it.

Tax authorities have found over 61 cases of evasion of GST since its rollout on July 1, 2017.

“Until February 2018, 61 cases of tax invasion involving Rs.315.13 crore were detected,” said the Directorate General of Goods and Services Tax Intelligence (DGGSTI), in response to an RTI filed by BusinessLine.

Officials said more cases have been detected in subsequent months, and pegged the total tax evaded at over Rs.500 crore.

While the DGGSI declined to comment on the means adopted to evade taxes, officials point out that under-reporting and availing wrong credit continues to be one of the most common ways. “Sometimes there have been genuine errors by the taxpayers due to lack of knowledge about GST. This is most common in the filing of monthly returns,” noted an official, adding that some businesses were also not paying GST despite being eligible.

Tax officials have also made a number of arrests for suspected GST evasion.

With the rollout of the new tax completing nearly one year, they also plan to be more stringent about evasion.

Though revenue from GST crossed Rs.1 lakh crore in April, tax evasion has been a concern for both the Centre and the States, and they have been working to introduce measures to detect and curb revenue leakage.

The GST Council has already introduced the e-way bill to check evasion in inter-State movement of goods. In its meeting on Friday, the Council is also expected to finalise new monthly return forms that will not only be simpler but also have more provisions to check tax leakage.

Data analytics

In a report to the GST Council in its March 28 meeting, the GST Network said that using data analytics, it had also found divergences in the amount of Integrated GST and compensation cess paid by some importers and the input tax credit claimed by them.

In some cases, it had also found “major gaps” in the self-declared liability in GSTR-1 and GSTR-3B.

The GST Council has since then asked GSTN to expand its use of data analytics and look more closely into such divergences.

[The Hindu Business Line]