FM Announces Crackdown: Uncovering INR 24,000 Crore Tax Evasion and 21,791 Fake GST Registrations

1. Discovery of Fake GST Registrations and Tax Evasion:

- During a two-month special campaign, GST authorities found 21,791 fake GST registrations and identified nearly Rs. 24,000 crore in suspected tax evasion.

2. Government's Response to Protect Honest Taxpayers:

- Finance Minister Nirmala Sitharaman emphasized that instructions have been issued to exercise caution in using powers like summons, provisional attachment of property, and blocking tax credit to safeguard honest taxpayers.

3. Breakdown of Fake GST Registrations and Tax Evasion:

- Out of the entities with fake GST registrations, 11,392 were under state tax jurisdiction, and 10,399 were under CBIC jurisdiction. The total suspected tax evasion was Rs. 24,010 crore, with Rs. 8,805 crore under state jurisdiction and Rs. 15,205 crore under the Centre.

4. CBIC Special Drive Details:

- The Finance Minister responded to a question about the Central Board of Indirect Taxes and Customs (CBIC) special drive conducted from May 16 to July 15, 2023.

5. Challenges for E-commerce Enterprises in GST Registration:

- In response to concerns about challenges faced by e-commerce enterprises, Sitharaman mentioned a simplified registration procedure for e-commerce operators, allowing registration in a state without physical presence by providing information about the primary place of business in another state or Union Territory.

6. GST Rules Modifications:

- Modifications to GST Rules have been implemented to tighten the registration process, including biometric-based Aadhaar authentication for high-risk registrants and verification of original documents.

7. Pilot Experiment in Gujarat and Expansion:

- A pilot experiment in Gujarat for bank account details, name, and PAN submission was expanded to Puducherry in July and Andhra Pradesh in November.

8. Mandatory Bank Account Details Submission:

- Registered persons must provide bank account details, name, and PAN within 30 days of registration or before submitting the statement of outward supply, whichever is sooner.

9. Suspension for Non-compliance:

- Entities failing to provide valid bank account details within the specified time will be immediately suspended by the system. However, compliance later will automatically revoke the system-based suspension. Source : https://studycafe.in/tax-evasion-of-rs-24000-crore-and-21791-fake-gst-registrations-detected-in-a-special-drive-fm-273603.html