Govt plans big move to stop large-scale dodging

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With a foolproof system to match all transaction invoices being delayed inordinately, the Goods and Services Tax (GST) Council will soon have a facility to capture transactions of large B2B businesses on a real-time basis. The move will enable tax officials to close most routes of large-scale tax evasion, even as they fear the wait for the nationwide invoice-matching system, that missed several deadlines, may get longer. Once real-time reporting of transactions to a central portal starts, it will be practically difficult for the businesses concerned to reduce their tax liability by inflating the claims for input tax credits. According to official sources, the system would be implemented in phases and could finally cover most of the taxpayer base. Initially, it would be made mandatory only for relatively large companies involved in business-to-business (B2B) transactions, they added.

The government is concerned about the GST collections continuing to trail the targets by wide margins. While last year, the actual collections were about `60,000 crores less than the revised estimate (which itself was a full `1 lakh crore lower than the original budget estimate), the average collection/month in April-May period this fiscal was `1.06 lakh crore against the targeted `1.14 lakh crore. Experts said the primary difference between proposed ‘e-invoices’ and the return-filing system with an invoice-matching feature as planned earlier is that the former allows real-time reporting. While a system of simple-yet-comprehensive returns, buttressed with invoice-matching is considered to be an important anti-evasion tool, under this system, frauds can be identified only at the end of the monthly tax payment cycle. This often leaves escape routes for habitual evaders and fly-by-night operators.

Read More at; https://www.financialexpress.com/economy/govt-plans-big-move-to-close-routes-of-large-scale-gst-evasion/1604740/