December 9, 2020: The indirect tax administration has initiated a drive urging businesses to pay their taxes on time to make up for the revenue lost during the peak of the pandemic. This comes against the backdrop of a massive 28% year-on-year contraction in central goods and services tax (CGST) revenue collections in the first seven months of the fiscal year. The risk management and analysis wing of the Central Board of Indirect Taxes and Customs (CBIC) has shared a list of businesses with field officers and asked them to ensure that the companies file their returns and pay taxes on time.
CBIC chairman M. Ajit Kumar told the officers to fill the “substantial” revenue gap to the extent possible and focus on those who have not filed returns or have stopped filing, a person familiar with the development said seeking anonymity. Businesses filing taxes on time will get reminders to ensure that they pay the correct amount.
GST authorities had initiated a drive against tax evasion through more checks and balances to the registration process, making Aadhaar authentication compulsory to avoid physical verification of the main place of business. This ensures that the benefits under the deemed registration process, which is to take place within three days, are not abused.
The government had set a ₹5.8 trillion target for CGST receipts in FY21, but has collected only ₹2 trillion in the April-October period. GST cess collection, too, has seen 23% contraction during the period from the year ago to ₹42,804 crore.
The Centre has stepped up its borrowing for the current year substantially from the original estimate of ₹7.8 trillion to ₹13.1 trillion. This comes against the backdrop of tax collections being well below the target and stake sales in state-run enterprises not taking off.
The income tax department, which has also witnessed a 27% decline in direct tax collections for the April-October period from the year ago level to ₹3.75 trillion, has stepped up its compliance and anti-evasion drive for the final months of the fiscal year.
Source: mint
