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GST biggest leakage source non- billed purchase

GST biggest leakage source non- billed purchase



GST biggest leakage source non- billed purchase

At the first national GST conference attended by the senior officers across the country, to discuss the issue identified by tax authorities, B2C sales as a key source of leakage of goods and service tax (GST) as consumers are often cajoled into paying in cash without taking a bill and are looking to incentivise digital payments to plug revenue leakages. As per officials check on this channel of leakage could bolster revenue by 15-20% as in certain products the revenue leakage is massive.

The government has being observing in last few months that revenue leakage has so far focused on businesses getting fake tax credits on inputs or cracking down on fly-by-night operators who often disappear after getting input tax credit (ITC) claim.

Major cause of leakage in B2C mode as per tax experts is high rates. At the centre, authorities have discussed multiple options and some of the ideas were shared with officers with feedback sought from them.

The Central Board of Indirect taxes and customs that incentivising payments as one of the solutions discussed with sops for customers. The Government e-Marketplace (GeM) would  be required for loyalty programme opened for retail dealing.

During the meet other issues discussed included uniformity between states interpretation of GST and improving tax officials approach to customers, e-invoicing and tax reforms and an analysis of revenue trends.

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