Government begins GST raid on jewellers as tax mop-up slips 

downloadSuspecting large-scale evasion, the government has got into action as collection of Goods and Services Tax is declining. In the first case of its kind in Mumbai, and probably the biggest in the country, 90 parcels containing jewellery have been confiscated by the GST department for flouting of tax norms. 85 carriers have been detained for ferrying consignment without proper paperwork. 

In November last year, the Kerala state GST Department had seized 14.5 kg of gold ornaments worth Rs 4.80 crore. In December, the department seized 3 kg of gold from a Mumbai native in Kochi. 

So far, the government had been trying to lighten the compliance burden on businesses due to the complexity of the new tax regime. But the GST raids indicate that the government is no longer going to be soft on compliance. 

This is the first such raid carried out by the department in Mumbai ever since the implementation of the GST by the government. 

Nationwide launch of the eway bill from February 1 is expected to check evasion by ensuring goods are tagged and tax paid. It could not be rolled out earlier as software and nationwide system was not ready. 

The government fears lack of monitoring of cargo movement could have allowed cash dealing across the entire value chain to evade taxes, which could have been reason for the sharp decline in GST collections in past two months. 

According to government data, GST collection for the month of November slipped to a five-month low of Rs 80,808 crore. Nearly six lakh taxpayers availing the simple composition scheme under the GST have paid a tax of only about Rs 250 crore for July-August, leading the government to suspect large-scale evasion. 

The GST Council has decided to start eway bill for inter-state movement of goods from February 1. Eway bill is an electronic document that is required if goods worth more than Rs 50,000 is transported and carries the details of supplier, buyers and goods being transported. There have been fears the bill will lead to harassment as any cargo would be stopped for checking. 

Source: Economic Times


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