gst-evasion-soars-to-over-rs-2-trillion-in-fy24-nearly-10-of-total-collections

GST evasion cases reached unprecedented levels in the fiscal year 2023-24, with authorities uncovering over Rs 2.01 trillion in evaded taxes, equivalent to nearly 10% of the total GST collections for the period.

 

Despite this substantial evasion, gross GST collections surged by 11.6% compared to the previous fiscal year, reaching Rs 20.18 trillion.

 

 The Directorate General of GST Intelligence (DGGI), the intelligence arm under the Ministry of Finance's Department of Revenue, reported that a significant portion of the detected evasion was concentrated in sectors such as online gaming and casinos (Rs 83,588 crore), co-insurance/re-insurance (Rs 16,305 crore), and secondment (Rs 1,064 crore).

 

The fiscal year 2023-24 witnessed a staggering increase in the number of detected evasion cases, totaling 6,074, with a combined sum of around Rs 2,01,931 crore—a remarkable 99% jump from the previous fiscal year. Additionally, voluntary payments increased to Rs 26,598 crore, constituting approximately 1.3% of total GST collections for the year.

 

One of the primary concerns for GST authorities remains the wrongful availing of input tax credit (ITC) or fake ITC claims, which continue to undermine government revenue. In response, the DGGI conducted a specialized drive against fake ITC, uncovering 2,197 cases involving ITC fraud amounting to Rs 21,089 crore, with voluntary payments totaling Rs 2,577 crore.

 

The crackdown on fraudulent activities extended to apprehending masterminds involved in orchestrating such schemes.

 

During FY24, 113 masterminds were arrested in connection with fake ITC, adding to the 147 overall arrests made by GST authorities. 

 

In addition to sector-specific investigations, GST notices were issued to address various issues such as underpayment of tax, incorrect availment of input tax credit, and discrepancies between filed returns and financial statements. 

 

To enhance detection capabilities, GST authorities are leveraging advanced technologies such as Big Data Analytics and Artificial Intelligence.