In a significant development, the Chief of the Central Board of Indirect Taxes and Customs (CBIC), Sanjay Kumar Agarwal, attributed the recent surge in monthly Goods and Services Tax (GST) collections to a marked improvement in compliance among businesses. Speaking on Thursday, Agarwal elaborated on the factors contributing to this positive trend and shared insights into the government's ongoing efforts to combat tax evasion.
The CBIC chief highlighted that the enhanced GST collections are primarily the result of businesses complying more diligently with tax regulations. This increased compliance has led to higher revenue inflows for the government, benefiting the nation's fiscal health.
One of the key initiatives aimed at further strengthening compliance is the GST Council's decision to tighten the return filing and registration processes. By doing so, the government aims to reduce the prevalence of fake Input Tax Credit (ITC) claims, particularly in sectors prone to tax evasion, such as the iron and steel industry. Fake ITC claims have been a persistent issue, causing revenue losses and undermining the effectiveness of the GST system.
Agarwal also revealed that the CBIC has been actively receiving suggestions on streamlining tax rates in sectors known for tax evasion. These suggestions are currently under discussion, indicating that the government is considering adjustments to tax rates in order to curb tax evasion more effectively.
In terms of concrete figures, the GST collection for the month of April stood at a robust Rs 1.87 lakh crore. Moreover, the trend has been positive over the first four months of the current fiscal year, with an average collection of Rs 1.67 lakh crore per month.
This development reflects the government's commitment to enhancing compliance, reducing tax evasion, and optimizing revenue collection. The initiatives undertaken by the GST Council, in consultation with the CBIC, are expected to have a lasting impact on the nation's tax ecosystem, fostering transparency and fiscal discipline.
As discussions continue on streamlining tax rates and further tightening compliance measures, the Indian business landscape can anticipate a more equitable and efficient tax environment in the future.