Steps to rein in tax evasion: Isaac
Penalty on business houses that failed to file tax returns
Finance Minister T.M. Thomas Isaac has said that the government will soon adopt stringent steps to rein in the tax evasion by commercial establishments.
Pointing out that the State had been witnessing widespread tax evasion since the introduction of the Goods and Services Tax (GST) regime, Dr. Isaac told the Assembly on Friday that the government would impose penalties on business houses that failed to file their returns and pay taxes by June end. Scrutiny would also be imposed in cases where the e-way bills did not match the sales.
Defaulters who fail to file their tax returns for over three months will be slapped with penalties equivalent to the actual amount. The Minister said there were many business entities who were yet to file their GST returns for six months.
Responding to a question raised by V.K.C. Mammed Koya, MLA, Dr. Isaac said that several businesses were adversely affected as raw materials attracted higher tax than finished goods. The issue would be brought to the attention of the GST Council.
He said the government would also appeal to the council to reconsider its decision to exempt gems and jewellery industry from the requirement for e-way bills, an electronically-generated document required for the movement of goods. The exemption had led to massive gold tax evasion with the government tax revenue through the business falling from ₹627 crore during the Value Added Tax (VAT) regime to ₹220 crore following the introduction of GST. This was despite gold sales currently incurring a GST of 3%, more than half the tax that was imposed as VAT (1.25%).
Dr. Isaac said the State stood to gain an additional revenue of ₹600 crore annually through the introduction of the flood cess.
Source- The Hindu.
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