The central tax officials fetched the GST evasion surged to Rs 44,170 cr between April 2019 and October 2023, in Karnataka which directed the arrest of at least 30 people. But the recovery shall stand at only Rs 9,187 crore, accounting for only 20% of the evaded amount.
As per the Ministry of Finance data, the central tax administration’s detection and recovery efforts weren’t limited by registrants’ administrative jurisdiction. This means that both errant registrants falling under the Center and those under state authorities were included.
The Ministry highlighted its commitment to curbing GST evasion, leveraging insights from the Directorate General of Analytics and Risk Management (DGARM). Additionally, measures initiated by the Directorate General of GST Intelligence (DGGI) and Central GST field units, such as scrutinizing evasion through the e-way bill system and acting on specific intelligence, were mentioned.
Out of the total Rs 44,170 crore evasion reported, Rs 5,043 crore occurred between April 1, 2023, and October 31, 2023, with the highest evasion of Rs 25,839 crore recorded in 2022-23. Rs 612.1 crore was recovered in the initial seven months of the current fiscal year, while the highest recovery of Rs 4,435 crore happened in 2021-22. Notably, in 2021-22, the administration successfully retrieved 76% of the Rs 5,850 crore reportedly evaded.
A commercial taxes official in Karnataka informed TOI that the data specifically refers to enforcement actions carried out by the central administration under the Central GST Act. They highlighted ongoing challenges related to recovery, citing a prolonged adjudication process that often alters initial estimations of evasion due to document submissions by assesses or registrants, leading to reductions in the final penalty or recovery amounts.
Emphasizing increased efficiency in enforcement efforts at both central and state levels, the GST official noted a targeted focus on organized illegal activities. Surprise raids based on specific intelligence have also been a part of this drive.
Nationally, authorities uncovered GST evasion exceeding Rs 4.4 lakh crore, recovering about Rs 1.1 lakh crore, roughly 25% of the total. However, in Maharashtra, the recovery rate stands at 19%, while in Delhi, it’s approximately 28%. In Gujarat and Tamil Nadu, recovery rates are 25% and 39.8%, respectively.
Across most states and union territories, the recovery rate remains below 50% for the mentioned periods, with some states showing improvements over a year or two.
