Home >News >India >Government red flags 40,000 businesses for excess tax rebate claims

GST authorities have zeroed in on about 40,000 companies for claiming excess or wrongful tax rebates, who will now be pursued for recovery of tax dues, said a government official.

If the authorities are not able to recover tax dues from the identified companies with the electronic communication such as emails and text messages, they will be visited by officials and further steps will be taken, said the official quoted above, who spoke on condition of anonymity.

The government recently stepped up efforts to mobilise revenue collection by launching a crackdown on tax evaders and those who have claimed rebates in excess of the taxes they have paid on raw materials and services procured.

“Electronic communications to such identified taxpayers and fraudulent refund seekers and over-invoice users would be followed by visits from GST field formations to make them abide by the law and pay tax dues in time," said the official. The measures to meet revenue target are being supervised by revenue secretary Ajay Bhushan Pandey.

The drive will cover all businesses that have claimed ‘excess’ tax rebates, have not filed tax returns or have given information which fails to match with what their suppliers have disclosed.

The official said that the revenue department has set a target of collecting 1.15 trillion in GST each in January and February and 1.25 trillion in March. So far, central and state governments have collected over 9 trillion in GST. Officials have also been told not to overstep their authority in their efforts.

Tax experts said that already the government has taken a series of steps towards revenue augmentation, which include cancellation of registration, blocking of e-way bill and restriction on use of tax credit in certain circumstances. “With pressure on the government to bridge the revenue deficit gap, we will see a lot of steps being taken on blocking of credit, attachment of bank accounts and even arrests, and legal challenge to such actions by taxpayers," said Ritesh Kanodia, partner, Dhruva Advisors.

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