After overcoming initial challenges with GST implementation, efforts have been made to improve the ease of doing business, attract new taxpayers, streamline the return filing process and meet tax targets. However, a formidable challenge remains for the state and the country: massive tax evasion.
Nearly seven years since GST rollout, Gujarat has witnessed a staggering Rs. 94,761 crore in bogus billing turnover, leading to Rs. 11,613 crore in evaded taxes.
Data from the state commercial tax department, spanning FY 2017-18 to FY 2024-25, reveals this alarming trend. SGST officials have arrested 113 individuals, including key masterminds behind major tax evasion scams.
Despite numerous rule changes, fake billing scams persist, causing substantial tax evasion and significant losses to the exchequer. According to sources, only about 5% of the evaded amount, roughly Rs. 550 crore, has been recovered by the department. In FY 2024 alone, 2,729 cases of bogus willing were recorded, involving fake GST registrations to dodge taxes. The number of cases has surged by 50%.
SGST officials reported that Rs. 22,680 crore in fake billing transactions were made during the year to evade Rs. 3,730 crore in taxes. While the bogus willing turnover decreased by 37% compared to FY 2024, tax evasion increased by 30% in just one year.
In a statewide drive, both state and central GST departments are cracking down on scammers to curb fake billing. Gujarat also implemented a pilot project requiring biometric verification for new GSTINs, addressing the critical issue of no physical verification at the time of issuance. This biometric verification has led to a sharp decline in new registration applications in Gujarat.
“A number of changes proposed by the SGST department here have now been acknowledged at the national level and are being implemented in several other states facing similar issues,” said a source. The SGST department is also leveraging big data analytics to detect illicitly obtained registrations and prevent further frauds.
Source: The Times of India
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