Finance Minister Nirmala Sitharaman on Thursday said taxpayer base has almost doubled to 1.28 crore in four years of rollout of the historic tax reform and the enhanced GST mop up in the recent months should now be the "new normal".
In a written message to tax officers on the fourth anniversary of GST rollout, she said implementing any reform of this scale in a large and diverse country like India can be highly challenging, but GST has brought about ease in taxpayer compliance and reduced common man's tax burden.
For eight months in a row, Goods and Services Tax (GST) revenues have crossed Rs 1 lakh crore mark and touched a record Rs 1.41 lakh crore in April 2021. "Commendable work has been done in the year gone by both in the area of facilitation and enforcement with numerous cases of fraudulent dealers and ITC being registered.
The enhanced revenue collection in recent months should now be the 'new normal'," Sitharaman said. In the last four years, the GST taxpayer base has almost doubled to 1.28 crore from 66.25 lakh. Minister of State for Finance Anurag Singh Thakur, in his message on GST Day, said in the past year a balance has been struck between trade facilitation and enforcement.
The enforcement drive launched by Central Board of Indirect Taxes and Customs (CBIC) since November 2020 has resulted in detecting cases of fake ITC (input tax credit) and evasion of GST of more than Rs 29,000 crore till now, Thakur said. A nationwide GST, which subsumed 17 local levies like excise duty, service tax and value-added tax (VAT) and 13 cesses, was rolled out on July 1, 2017.
Expressing satisfaction on overcoming most of the GST implementation challenges, including two waves of the COVID-19 pandemic, the minister also thanked taxpayers for their support in making GST a reality.
The CBIC will be issuing certificate of appreciation to 54,439 GST payers for timely filing of returns and cash payment of GST in the last four years. More than 88 per cent of these taxpayers are from micro, small and medium enterprises. Its positive externalities such as unified market, removal of cascading and improved competitiveness of goods and services has helped spur economic growth taking us further on the path to prosperity," she said while commending both the central and state tax officers for making GST a success.
"Any reform of this scale, in a large and diverse country such as ours, can only be highly challenging. The GST Council has shown immense sagacity and wisdom in redressing legitimate concerns of taxpayers and citizens by course correction whenever needed. This has manifested itself not just in measures to ease the compliance burden on taxpayers, especially MSMEs, but also reducing the tax burden on the common man," Sitharaman added. Addressing a webinar on GST Day,
Road Transport Minister Nitin Gadkari said that GST will help achieve the vision of USD 5 trillion economy by 2025. Under GST, businesses with an annual turnover of up to Rs 40 lakh are exempt from GST. Additionally, those with a turnover up to Rs 1.5 crore can opt for the Composition Scheme and pay only 1 per cent tax. For services, businesses with turnover up to Rs 20 lakh in a year are GST exempt.
A service provider having turnover up to Rs 50 lakh in a year can opt for composition scheme for services and pay only 6 per cent tax. Under GST a four-rate structure that exempts or imposes a low rate of tax 5 per cent on essential items and top rate of 28 per cent on cars is levied. The other slabs of tax are 12 and 18 per cent.
In the pre-GST era, the total of VAT, excise, CST (central sales tax) and their cascading effect led to 31 per cent as tax payable, on an average, for a consumer. GST also represents an unprecedented exercise in fiscal federalism. The GST Council, that brings together the central and state governments, has met 44 times to thrash out how the tax will work.