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GST mop-up: Govt now suspects under-reporting of Rs 34,000 crore for July-December 2017

A preliminary analysis of Goods and Services Tax (GST) returns filed between July and December 2017 shows that the scale of under-reporting of tax liabilities could be as high as Rs 34,000 crore, according to a media report.

Representational image. PTI

Representational image. PTI

The matter, according to a Times of India report, was flagged last week at a meeting of the GST Council. Authorities may now issue notices to traders and businessmen who have shown different liabilities in GSTR-1, which is largely used for information purposes, and GSTR-3B. The focus will be on those who have shown a wide variance in the two filings. Details of suspects could be shared with states for action, the report said.

Tax consultants, however, opine that there could be sound reasons for variations in the two returns, because at the time of payment of taxes, input tax credit accumulated over months is used, along with the current periods. By contrast, the aforementioned details are not provided when submitting GSTR-1, which is a sales register where invoice details are entered.

Furthermore, the Centre also fears under-reporting of the value of imported goods. Data examined by customs authorities shows that in several instances, the value of imported products was shown to be lower, which authorities suspect was done to pay a lower GST at every stage of the sale process, the report added.

The absence of fixed targets and frequent revisions in GST rates has impacted the stability of the new tax regime and has adversely impacted trade and businesses, a Parliamentary panel observed in a report last week. "The Committee are constrained to observe the not-so-encouraging monthly revenue collections from GST, which still have not stabilised with frequent changes in rates and issue of notifications every now and then. Further, the Committee are surprised to learn that no GST revenue targets have been fixed by the government," the Standing Committee on Finance headed by Congress member M Veerappa Moily said in its report tabled in Parliament on 10 March.

(With inputs from PTI)

Updated Date: Mar 12, 2018 17:37 PM

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