Telangana government, having waited for three months for the newly rolled out Goods and Services Tax system to stabilize, will now focus on increasing compliance by every trader, in the composition scheme or outside of it.

The traders and manufacturers with an annual turnover of not more than ₹1 crore who opted for composition scheme are allowed to file their returns quarterly and others, every month.

Telangana is much better off in getting adjusted to the new tax regime but some sections may still be facing issues.

Focus area

“We decided to deploy our staff to focus on such dealers and traders and help resolve any issues and ensure everyone is part of the system and comfortable with it,” Mr. Somesh Kumar, Principal Secretary , Commercial Taxes told The Hindu.

Each department employee will cater to 200 plus dealers and his job over the next few weeks is to check their compliance on four of five criteria under the GST. If the trader faces any issues, they will help in resolving them and in filing returns, both under the composition and non-composition schemes.

These department employees will create awareness among traders on GST compliance. Unlike in the earlier regime, non-compliance and delay in filing returns even by a day will attract penalty of ₹ 200 a day.

After the hand holding by the department personnel, department will start verifying to check suppressing of actual transactions by the trader and any non-compliance will be viewed seriously.

The department wanted to rope in consumers too to make GST compliance 100 per cent through the recently launched TGST App. The App facilitates people to take the pictures of the bills issued and upload it and the system would read and store the data. If a composition scheme manufacturer/dealer, collects tax from customers against the norms, it will be detected. Under the composition scheme, the trader should not collect tax from customer as he would pay standard tax on his turnover.

There are many outlets that do roaring business. When more and more consumers start uploading the bills, it will give a fair idea to the department about the actual business turnover even if the trader tried to suppress it. The department has proposals to reward the customers who upload the bills and every month one such customer will be chosen through lots.

Self-policing mechanism

Officials are not too worried about those under the non-composition scheme as the input tax credit facility and the matching of invoices in the chain of transactions at various levels are two significant measures that make evasion detectable eventually. The ITC feature brings in self policing mechanism.

Mr. Somesh Kumar is confident that direct taxation will also gain because of GST as it will not be easy any more for traders and dealers to evade tax on their income.

Aadhaar linkage

The 10 digit Aadhaar is part of the 15 digit GSTN . This will make it possible for one to keep tabs on high value purchases and investments even if one under reported his income.

“The Income Tax department will bank on our GST data if they see something amiss,” he says.

Another significant measure that will make it difficult for tax evasion is online audit of tax returns. Mr. Kumar who had introduced it said it was to bring in transparency and do away the discretion of officials.

Source: The Hindu

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