The Central Board of Indirect Taxes & Customs (CBIC) intends to ‘vigorously pursue’ non-filers of Goods & Services Tax (GST) in a move to help boost GST collections.
“I would urge all field officers to vigorously pursue with the non-filers amongst Centre’s assessees and get the due revenue deposited,” CBIC Chairman Pranab Kumar Das said in a letter to all his colleagues. His statement comes at a time when, on an average, 20 per cent assessees are not filing their returns thus impacting the revenue collection. This has been happening with both Centre’s and States’ assessees.
The Centre’s assessees are 10 per cent of taxpayers having turnover below ₹1.5 crore and 50 per cent taxpayers having turnover above ₹1.5 crore. The remaining 90 per cent and 50 per cent taxpayers belonging to both the categories are called States’ assessees.
Meanwhile, a senior official dealing with indirect taxes said vigorous persuasion does not mean adversarial environment. “Effort would be to convince non-filers to file returns and deposit tax as this will benefit them,” another official said. From August 21, non-filing of returns for two consecutive tax periods will result in a bar from generating e-way bills.
GST filing
According to the law, every person registered under the GST will have to file returns in some form or the other. A registered person will have to file returns either monthly (normal supplier) or on a quarterly basis (supplier opting for composition scheme). An ISD (Input Service Distributor) will have to file monthly returns showing details of credit distributed during the particular month. A person required to deduct tax (TDS or Tax Deducted at Source) and persons required to collect tax (TCS or Tax Collected at Source) will also have to file monthly returns showing the amount deducted/collected and other specified details. A non-resident taxable person will also have to file returns for the period of activity undertaken.
As of now, there are more than 1.20 crore GST assessees, of which nearly 1.02 crore have to file returns on a monthly basis, while the remaining file on a quarterly basis.
The CBIC chief’s appeal has come at a time when average revenue collections during the current fiscal is over ₹1 lakh crore. Certainly, this is sufficient to meet the scaled down target of GST collection as projected in the Budget. Finance Minister Nirmala Sitharaman scaled down the GST collection target to ₹6.63 lakh crore, from ₹7.61 lakh crore. Accordingly, combined with State GST (SGST), the average monthly collection is now estimated at nearly ₹1 lakh crore as against ₹1.14 lakh crore (based on the data of Interim Budget).
However, scaling down the target does not mean that the government wants less revenue. It needs more funds to meet the rising expenditure and contain fiscal deficit. Data show that net tax collections (direct as well as indirect) have not been exceeding exceptions. Net tax collections during the first three months (April-June) have been just 14.7 per cent of the Budget Estimate while overall expenditure was nearly 26 per cent of the Budget Estimate which means the fiscal deficit is nearly 61 per cent of the Budget target.