Govt identifies Rs 20,000 cr GST deception in April-Feb Financial Year'19

The govt will take further actions to curb scams and enhance compliance, a senior tax official said Wednesday.

The government has recognized Rs 20,000 crore worth GST deception so far this financial year and will take more measures to suppress scams and increase compliance, a senior tax official said Wednesday. 
 
Central Board of Indirect Taxes and Customs Member John Joseph moreover said the department would soon call an assemblage of the representatives of the real estate sector to understand transformation issues faced by the sector post decrease in GST rates. 
The GST Council, headed by Finance Minister Arun Jaitley and including state equivalents, earlier this week determined to decrease tax rates on under-construction apartments and affordable housing to 5 percent and 1 percent, respectively. 
 
However, builders will not be authorized to demand credit for the taxes given on inputs, like steel, cement. 
The initial GST rate on under-construction apartments and affordable housing was 12 percent and 8 percent with an input tax credit (ITC), respectively. 
 
On-demand for giving ITC relief to the builders of the under-construction flats which are previously built but not yet traded to customers, Joseph said the real estate area would have to elevate the issue with the urban development ministry. 
 At an Assocham function, he said
"You need to talk to them (urban development ministry). As the revenue department, we cannot give you any benefit of subsidy to that extent,"  here. 
 
Joseph said within April-February 2018-19, GST evasion meriting Rs 20,000 crore has been identified of which Rs 10,000 crore was recovered. 
 
He said the tax officers on Tuesday identified fraudulent invoice worth Rs 1,500 crore which was used to declare unlawful GST credit of Rs 75 crore. 
Joseph said
"We have already recovered Rs 25 crore, and the rest is on the way." 
 
Asserting that only 5-10 percent of the businesses are "black sheep" and bring a poor reputation to the industry, he said the government would consider new stratagems to enhance compliance, and act against evaders in a way such that legitimate businesses do not suffer. 
 
Joseph said the government has been influential in rationalizing tax rates since GST rollout on July 1, 2017, while rising compliance for 1.2 crores registered businesses. 
"In future, as GST proceeds ahead, the charges need to condense. Across the world, it is one rate, but it may not be feasible for us to realize it here due to the fact that we have the poorest of the poor and the richest of the rich in the country. 
He said
"What is good for the richest, cannot be the best for the poor... But 5 rates converging into 2 or 3, depending on what the Council decides. This is the way forward," 
 
Currently, GST has a 4-tier slab of 5, 12, 18 and 28 percent, while necessary items are zero-rated.