We have new strategy to raise GST collections: CBIC Chairman

For the first time, April GST collection surpassed Rs 1.5 lakh crore, and for the eleventh month in a row, it surpassed Rs 1 lakh crore. And, assuming everything goes well, Central Board of Indirect Taxes and Customs (CBIC) chairman Vivek Johri expects steady growth in the range of Rs 1.35 lakh crore per month this financial.

“GST collections have consistently been higher than the pace of GDP growth.” The economy is recovering, thanks in part to inflation and a rise in oil prices. Customs revenue will be under strain due to increased commodity prices. Excise will suffer as a result of the duty reduction,” Johri said at a FICCI gathering.

“However, in order to maintain revenue buoyancy, we have adjusted our strategy.” One feasible option to maintain revenue is to rationalise tax rates to allow refunds and credits to flow freely, reversing the inversions,” he said.

How will the government increase GST collection?

According to the CBIC chairman, the government may consider increasing income through legal and administrative adjustments, such as tightening enforcement to reduce leakages and pursuing better compliance.

“Legal adjustments were implemented to enable taxpayers to file their returns, something they were unable to do during the peak of COVID, and to improve the tax filing process.” We have upgraded our e-invoicing technologies, allowing us to build the tax-paying structure and credit system. “Automated return generation and return interconnectivity have aided in the acceleration of credits and the reduction of compliance costs for taxpayers,” Johri said.

He went on to say that a system had been put in place to enable small, medium, and big taxpayers decrease their tax compliance load. “We also chose Aadhaar authentication to ensure that the credit system is not abused,” Johri explained.

How will it pursue high-risk taxpayers?

Johri stated that his department has been working hard to prevent illegal tax evasion methods and identify dangerous taxpayers as soon as possible.

“Through data triangulation with the DGFT (Directorate General of Foreign Trade) and the income-tax department, we identified hazardous taxpayers and suspended their registrations.” Wrongdoers and those gaming the system have been weeded out,” Johri said, adding that as GST celebrates its fifth anniversary, his department is making every effort to reduce system misuse and increase compliance.

His department is also working with states to develop measures for catching wrongdoers. Johri stated that his department was able to “discover over 20,000 GSTNs, resulting in a Rs 2,400 crore recovery through drives to weed out bogus ITC and phoney taxpayers.”

Johri believes that encouraging taxpayers to file returns on time resulted in higher collections. “GSTR3B filing has increased from 73% in January 2021 to 80% in February 2022.” “And the entire revenue augmentation effort over the last two years has been driven by data analytics and data triangulation,” he explained.

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