Modi government uncovers ₹26,540cr GST evasion
The Central Board of Indirect Taxes and Customs (CBIC) has unearthed a whopping ₹26,543 crore Goods and Services Tax (GST) evasion. The board made the revelation during its second nationwide operation against fraudulent input tax credit (ITC). The investigation included a detailed examination of 68,903 high-risk taxpayers from August 16 onward. The CBIC's investigation found that among the taxpayers under scrutiny, 18,472 entities or nearly 27% were non-existent.
Fraud rampant in Maharashtra, Gujarat, and Delhi
These fraudulent activities were most rampant in states such as Maharashtra, Gujarat, and Delhi. Despite the huge amount of tax evasion detected, recovery is a tough task. A GST Council source explained to CNBC TV-18 that "In many cases, the ITC is utilized before the fraud is discovered."
GST Council to discuss findings and preventive measures
The findings of this operation are slated to be taken up at the GST Council meeting on December 21. The council is likely to deliberate on measures to improve GST compliance and strengthen crackdown on fake invoicing and ITC fraud. Out of the first list of 74,070 taxpayers flagged as risky, around 5,000 are yet to be verified mostly from Delhi and Maharashtra.
Pending verifications and state contributions
Maharashtra alone accounts for 765 pending verifications, while Delhi has 3,300 cases yet to be investigated. The list of risky taxpayers was shared by GST Network (GSTN), with states adding to it using their local intelligence. This is the second major operation against fake ITC frauds after the success of the first drive conducted from May 14 to July 14.
