Minister of State for Finance replies to question on GST evasion and recovery

The Minister of State for Finance Pankaj Chaudhary gave details of the total tax evasion detected and recovered in Goods and Services Tax (GST) in the last three years in a written reply to the Rajya Sabha. 

Period No.of cases GST evasion detected (Rs. in crore) GST recovered

(Rs. in crore)

FY 2019-20 10,657 40,853.27 18,464.07
FY 2020-21 12,596 49,383.96 12,235.00
FY 2021-22 (up to June 2021) 1,580 7,421.27 1,920.20

 

The minister informed that the GST interface is digitised, and it is software-based to be used for tax payment and to comply with the requirements of law and procedure by taxpayers.

However, tax evaders commit fraud even on digital platforms by misrepresenting facts like providing fake credentials at the time of registration, raising a fake invoice to avail under Input Tax Credit (ITC), misdeclaration of classification, etc.

The minister added that sometimes, the non-payment of tax might happen due to human error, and the evasion may be intentional. However, no tax evasion has been reported due to a failure in the CBIC back-end system.

The minister further said the government had included various validations in the GST Network (GSTN) system to weed out tax evaders and prevent tax evasion. These includes:

  • Adhaar authentication for processing of new registration applications
  • Provisions to suspend/cancel the registration of mischievous taxpayers
  • Suspension of registration based on business intelligence
  • Cancellation of registration of taxpayers for non-filing of GSTR-3B returns
  • Blocking of ITC credit

In reply to a separate question, the minister said that in the FY 2020-21, 7,268 ITC fraud cases were detected by Central GST officers, involving Rs.31,233 crore.

For any clarifications/feedback on the topic, please contact the writer at dvsr.anjaneyulu@cleartax.in

You May Also Like

Taxation of dividend income received on or after 1 April 2020 (FY 2020-21)

You may receive a dividend from your equity or mutual fund investments.…
GSTR-9

CBIC has notified an extension of two months to various GST compliance

The government of India has notified yet another extension for the completion…
Gold Jewellery

24K Gold Rate in India for November 2019: Week 4

The fourth week began with the gold rate in India holding at…

Due date to file annual GSTR-4 for FY 2019-20 gets further extended

The government has further pushed the deadline to file the brand new…