Centre sends out lakhs of GST recovery notices to taxpayers pan-India
In a bid to shore up GST collections and recover pending dues, the Centre has sent out several lakhs of recovery notices to taxpayers, sources said. These notices are under various sections including violations, claiming of excess credits and delayed payment.
A massive data analytics drive has helped the government calculate these dues which are legally pending to be cleared by the taxpayers, the sources added.
”A high-level revenue augmentation review meeting has been called by Revenue Secretary Ajay Bhushan Pandey today where GST wing has updated on the notices sent out and the recovery so far,” a senior government official said, confirming the development.
According to sources, the Centre’s GST wing has asked field formations to keep a close watch on over 262,000 GST taxpayers pan-India to ensure they file timely returns to maintain steady growth in monthly GST collections.
These taxpayers have been identified after detailed trend analysis through data monitoring, risk profiling and past return filing pattern.
Apart from this, the Centre has also asked field formations to assess taxpayers with a mismatch between declared liability and paid liability. “On this account, the Centre has identified Rs 36,000 crore worth of dues by taxpayers. Notices have been sent out for this to the taxpayers identified by data analytics,” the sources stated.
Taxpayers directed to refund credits
The Centre has also issued notices to taxpayers asking them to refund credits that have been taken on invoices for FY18 and FY19 but were time barred.
“Another set of notices have been sent out under section 36 (4) to the taxpayers identified for claiming more than 10 percent of credit dues in GSTR2A. The Centre estimates Rs 46000 crore of extra credit already availed by taxpayers and fields have been asked to re-assess the taxpayers and ensure a return of the excess claim to the government,” the sources pointed out.
Industry experts point to the need to follow a clear-cut process to streamline the GST system. “While business houses receiving notices on account of data mismatches, delayed returns, etc would feel hassled in responding to these notices while they are grappling with year-end sales and performance pressures, these notices, once again, bring out the need to follow a process-oriented approach on GST matters,” says MS Mani, partner, Deloitte India.
Abhishek Jain, Tax Partner at EY said: “While such investigations should typically help check tax evasion, the said decentralisation has become an area of concern for businesses especially the service industry who were used to centralised management of assessments. While companies are in general fine with providing adequate replies to notices, they have been facing concerns on in-person discussion with the various GST authorities; specifically given the locational inconvenience to those centrally managing GST compliances.”The government has also tallied dues of Rs 40,000 crore on account of interest to be paid on late payment of GST from July 2017 to September 2019. As per the rule, 18 percent interest is being charged on the amount of GST on account of late payment.
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