State commercial taxes department is staring at revenues lower by 30 per cent even as GST (Goods and Services Tax) has completed one year of existence this July 1, forcing taxmen to look at real estate, coal and scrap business firms to ratchet up collections.
According to a highly placed source in commercial taxes department, Rs 694 crore had been fixed as the monthly target in the last fiscal, but actual collections fell short by some 30 per cent every month. This shortfall, the taxman explained, was reimbursed by the Center, as it is hand-holding states for a period of five years to smoothen out problems in implementing GST. This year, the projected revenue collection has been fixed at Rs 791 crore a month for Jharkhand.
To rake up revenues, the commercial taxes department is focusing on real estate, coal and scrap business firms from which collections had been very low in the last financial year. “These three sectors involve heavy cash flow but not on paper. Many persons involved in these three sectors feel uncomfortable now (after GST) and try to find escape routes. We are preparing a database of such entities for special focus this year,” he said.Statistically, there are 1.5 lakhs registered entities registered with GST, much more than 30,000 in the earlier mode of taxation.
Coming on quote, additional commercial taxes commissioner Ajay Kumar Sinha admitted revenue collection from these three sectors was “pretty low”. “In the launch year, there were various hassles and confusions among taxpayers. But now things have improved. At first, we encourage defaulters to pay up with gentle reminders over calls, texts and emails. We offer them counselling on how to pay. When those steps fail, we file legal cases (FIRs) against erring entities,” he said.
He added that in the last financial year, they detected frauds worth Rs 300 crore under their jurisdiction and filed FIRs on 19 business entities across the state.
Explaining an instance, he said many businessmen show zero business turnover in monthly returns despite taking input credits. “Say you own a footwear showroom. When you get stocks from a wholesaler or manufacturer, you earn input credit in your account. But if you don’t file your monthly GST returns, you’re saying you have not sold even a single pair of slippers. So, why did you buy so much stock? We track these stringently,” he said.
Among realtors, GST has been painted the villain for the slump. But, Anchal Kinger, chairperson of FJCCI’s real estate sub-committee, denied it. “Realty sector was affected even before GST came into existence. At least for Ranchi I can say more than GST, the reasons for the slump is mostly due to local factors such as easy availability of raw materials, sand-lifting controversies, hassles in building plan approvals/clearances, high circle rates even in underdeveloped areas, among others,” he said.