Special Drive Unearths Massive GST Evasion of Rs 1.5 Lakh Crore Till October 2023

Last updated: 08 December 2023

Government Unveils Record-Breaking GST Evasion Detection of Rs 1.5 Lakh Crore; Focus on Online Gaming Companies Raises Stakes

In a significant revelation, the government disclosed on Monday that its intensified efforts to curb Goods and Services Tax (GST) evasion have resulted in detecting a staggering Rs 1.5 lakh crore during the first seven months of the current financial year. This surpasses the Rs 1.3 lakh crore detected in the entire fiscal year 2022-23, showcasing a notable surge in the crackdown on tax evasion.

Minister of State for Finance Pankaj Chaudhary informed the Rajya Sabha separately that authorities have issued 71 show cause notices to online gaming companies, involving an impressive Rs 1,12,332 crore in the current and preceding financial years. This move comes in response to the GST Council's decision to clarify that online gaming and casinos are subject to a 28% levy on the gross betting amount. Despite the government's anticipation of tax collection from these companies, the exact demand is yet to be determined, with ongoing legal challenges from some gaming companies.

 

The finance ministry shared data illustrating the impact of the crackdown on GST evasion. Of the over Rs 1.5 lakh crore detected this year, recoveries have reached Rs 18,541 crore. Furthermore, 154 individuals have been arrested up to October, compared to 190 in the previous fiscal year (2022-23). The government's proactive measures aim to counter fraudsters exploiting input tax credit based on bogus invoices and forged registrations.

The state of Maharashtra, housing the largest number of businesses and taxpayers, emerges as a hotspot for GST evasion, with an estimated Rs 84,400 crore, constituting 56% of the total evasion in India. The government, in collaboration with states, has escalated actions against these fraudsters.

In terms of recovery, Maharashtra has outperformed other states so far this year, reclaiming over Rs 4,100 crore. However, last year's recovery data shows a close competition with Rajasthan, where recoveries amounted to Rs 6,515 crore, just slightly ahead of Maharashtra's Rs 6,587 crore. These revelations came in response to a query by BJP MP Sushil Kumar Modi, shedding light on the evolving landscape of GST enforcement and the challenges posed by tax evasion in the country.



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