• Notification Date: 11-02-2022
• Notification No: N/A

Introduction of Biometric System to prevent GST Evasion

The Group of Ministers (GoM), led by the Deputy Chief Minister of Maharashtra, Ajit Pawar, has taken a significant measure to resolve tax evasion that has been subsequently increasing in the state. The group has unanimously decided to introduce an effective biometric system to reduce GST evasion and anomalies in the collection of tax. The new biometric system will be beneficial to check the tax evasions, and for inspection in the workplaces for the verification of professionals, direct inspection of financial transactions of employees. The inspections will be carried out based on the information obtained from the tax collection system. For the registration of GSTN, the registration of electricity consumer numbers is mandatory. This would help in cutting off the fake registrations. To detect any kind of suspicious activity, some innovative measures have been adopted. The certification of taxpayers’ bank accounts issued by the National Payments Corporation of India (NPCI) and the feedback mechanism are quite helpful for this purpose. The members of the group have unanimously agreed upon the establishment of these measures to rectify the loopholes in the GST framework and resolve the tax evasion issues.

The Group of Ministers from various states have recommended strong machinery for keeping the balances and checks in the proper place. This would lead to the prevention of tax evasion and lapses. Pawar has instructed the GST officials to refrain from harassing or inconveniencing the taxpayers at the time of tax collection.

According to Pawar, the GST registration of each of the traders will be thoroughly examined. The fake registrations will be cancelled and there will be some alterations in the filling returns. The department will take immediate actions to resolve the false bill issues and to regularize ITC chains. He also recommended the introduction of an effective system that would analyze the information accurately and prevent tax evasions. Online systems should be made available for the taxpayers to rectify the errors in the tax return filings. The GoM also recommended the implementation of a sequential filing system for managing the tax return filings. The information of the fake and unregistered traders will be publicly disclosed through Point of Sale (POS) by banks. The provision of information on fake transactions will also be revealed.

There were several other ministers from various states who attended the meeting. The Deputy Chief Minister of Haryana, Dushyant Chautala, spoke at the meeting. The Finance Minister of Tamil Nadu, Dr Palnivel Thiaga Rajan, and the Finance Minister of Assam, Mrs Ajanta Niyog also participated in the meeting.