CAG has requested the Finance Ministry to establish excessive danger taxpayers within the GST composition scheme on a periodical foundation and confirm from different sources, together with third events, their declared worth of gross sales to examine tax evasion.
| Picture Credit score: The Hindu
The Comptroller and Auditor Basic (CAG) has requested the Finance Ministry to establish excessive danger taxpayers within the GST composition scheme on a periodical foundation and confirm from different sources, together with third events, their declared worth of gross sales to examine tax evasion.
Primarily based on an evaluation of 8.66 lakh composition taxpayers underneath the central jurisdiction between 2019-20 to 2021-22 fiscals, the Comptroller and Auditor Basic (CAG) discovered {that a} important variety of GST taxpayers have a excessive danger of crossing the turnover threshold for composition levy scheme (CLS).
These excessive danger taxpayers had been recognized by audit from the info contained in GST returns viz. GSTR-4A, GSTR-7 together with third celebration knowledge sources equivalent to IT returns, ‘Vahan’ database and so forth.
The GST composition scheme is accessible to taxpayers whose combination turnover, within the previous monetary yr, has not exceeded ₹1.5 crore. For taxpayers in particular class states, this restrict is ₹75 lakh.
The CAG mentioned two main danger areas in respect of CLS taxpayers are under-declaration of the ‘worth of outward provide’ by the taxpayers to proceed within the scheme; and non-fulfillment of eligibility circumstances for availing CLS.
The audit additionally noticed that there have been sure CLS taxpayers who had been persevering with within the Scheme regardless of not fulfilling the eligibility standards prescribed within the Act and the Guidelines, and a considerable variety of CLS taxpayers weren’t discharging their compulsory duties of submitting returns and fee of tax underneath reverse cost.
“The Ministry ought to establish excessive danger taxpayers within the CLS on a periodical foundation utilizing a risk-based strategy and confirm their declared worth of outward provide from different sources together with third events to reduce the potential of misuse by ineligible individuals,” the CAG mentioned in a report tabled in Parliament not too long ago.
The official auditor additionally steered that the Finance Ministry might develop a system of figuring out ineligible taxpayers and take motion to exclude them from the CLS as a way to stop misuse of the supposed advantages of the scheme.
