The tax department is gearing for stricter enforcement with the help of technology and big data under the goods and services tax (GST), as the government looks for ways to boost GST revenue collection amidst delayed roll-out of anti-evasion measures.
The tax department is gearing for stricter enforcement with the help of technology and big data under the goods and services tax (GST), as the government looks for ways to boost GST revenue collection amidst delayed roll-out of anti-evasion measures. “We would have ideally wanted anti-evasion measures to be in place since GST was rolled out as it would have provided a cleaner way to stop evasion. But even with the current system, its possible to go after evaders,” a tax official said. He added that the exercise to catch and punish evaders won’t be quick but will serve as a reminder that under-reporting tax liability can still be caught. For the July-January period, the average monthly GST collection was about Rs 88,000 crore, but this needs to be over a quarter more at Rs 1,10,000 crore to be able to meet the budgetary target, a Kotak economic research report had said in February. Government officials said tighter enforcement was needed to ensure the growth in collection. After the GST Council’s meeting on Saturday, the government said data analysis had brought out variance between the amount of integrated GST and compensation cess paid by importers at customs ports and input tax credit (ITC) of the same claimed in GSTR-3B. Similarly, major gaps were found between self-declared liability in GSTR-1 and GSTR-3B, the government said in a statement. “Both excess claim or short claim of GST paid by importers at customs ports suggests rife tax evasion on borders. Reason for short claim of taxes paid could be the import of undervalued goods or supply of imported goods in black markets. Big data analytics would put tax evaders in a tough spot,” Rajat Mohan, partner at AMRG & Associates, said. Although the technological tools – invoice-matching and e-way bill – available with the government are still not being used due to lack of consensus on the modalities of implementation, the existing partial system of summary return (GSTR-3B) and sales invoice uploads (GSTR-1) have provided the government with valuable information on revenue leakages. In the absence of a comprehensive return-filing process, taxpayers have been submitting self-declared details of tax liability as well as ITC claims in summary returns. However, they are also required to file first of the now-suspended triplicate return forms GSTR-1. The information provided in these two forms can be tallied to check for discrepancy in reporting.