After record goods and services tax (GST) collection, the Central Board of Indirect Taxes and Customs (CBIC) is preparing a roadmap to widen the tax base with stricter audits and scrutiny.
There is much scope to widen the tax base and check tax evasion with active use of digital forensic tools and use of data integration and artificial intelligence, CBIC chairman Vivek Johri said in a post-budget interaction.
So far, the board has detected a revenue shortfall of ₹22,000 crore from the tax audits of 51,000 GST return filings and ₹2,200 crore from tax scrutiny of 31,000 GST returns. “We are looking at actively using audits and scrutiny for improving compliances. We have been able to achieve a big breakthrough in return filing percentage but it is not enough,” Johri said. “We also need to look at the quality of data that the values taxpayers are putting in the return.”
With these measures, Johri said, it will be possible to achieve average monthly GST collections of more than ₹1.50 lakh crore, up from the current average monthly GST collection of ₹1.45 lakh crore. The government has pegged GST revenue at ₹9.56 lakh crore for the next fiscal year, higher than the revised estimate for the current fiscal at ₹8.54 lakh crore.
The Board will be setting up five forensic digital labs in the coming fiscal year to use technology in a “more potent way” to detect tax evasion by using online data.
Johri said the focus of the budget is on simplification on the customs side.He said that while last year the board had done away with many exemptions, this year it has continued with some exemptions where there was either “strong recommendation” from the ministries in alignment with ‘Make in India’, or in those cases where they did not receive “timely inputs” from the industry or stakeholders.
The budget has also amended GST laws to decriminalise certain offences under the indirect tax law and double the threshold for launching prosecution under the tax law to Rs 2 crore, while retaining the limit at Rs 1 crore for fake invoicing cases.
“While many measures are being taken, we will continue to further decriminalise the law, as and when required,” Johri said.
He said that another measure which will reduce litigation and improve compliance is restricting GSTR 1, GSTR 3B and GSTR 9/9C. One can now file them post expiry of three years’ time period from the due date of filing of the relevant return.
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