Strict actions will be taken to avoid tax evasion: GST Commissioner KN Raghvan

Anurag Shah, Zee Business

KN Raghvan, Principal Commissioner, GST, Mumbai, in a candid talk with Zee Business's Anurag Shah informed that the new return process which has been placed for consideration and passage by the GST committee will help in solving problems related to return filing.

Here are the excerpts:

Q: GST has completed 1 year of its implementation and in this period, several concessions were granted to solve the problems that the system was facing. Should we assume that now steps will be taken to turn people serious about the tax reform?

A: Yes, there were challenges but they have been stabilised in the first year. GSTR-1 and the GSTR-3B process of filing have been stabilised to smoothen the process. Secondly, a new return process has been placed in front of the committee and its passage will solve the problems that are being faced while filing the returns. When it comes to compliance, then there were problems in the IT infrastructure of the system but it has been stabilised.

Besides, we faced several challenges in shifting from an established system to a new system. But this shift has helped in broadening the tax base as there is an increase in the number of taxpayers. It also helped in increasing the revenue. So we have progressed a lot in a year but certain challenges can prop up in the coming future and we are geared to face them.

Q: You are saying that the compliances will be increased. Can you tell us about the type of compliance that will be added to the list? Do you have a manpower to deal with the increase?

A: It is an IT-dependent system and thus will need an optimum use of the manpower. Increase in compliance that will make traders and suppliers, who are not part of the GST system will come forward to join the system to taste the benefits of the network like credits on their invoices. In addition, certain anti-evasion actions will be added to the system, which will force people involved in evasion to come forward to pay their taxes. So, the combination of support and tuff stands with regard to evaders will be taken in a long run.

Q: What will be the role of your department in the anti-evasion actions? The even wrong interpretation could also lead to evasions. Will you consider such evasions as a deliberate action?

A: No, only in cases where the evasions are done deliberately. Anti-evasion actions will not be slapped in cases of interpretations. In the case of interpretations, the final decisions will be made by the tribunals and courts. But, in cases of outright evasion or frauds in which the person collects the tax but don't pay it, the actions will be slapped on them. In fact, we will focus on outright frauds and evasions instead of interpretations.

Q: There were concerns related to bringing financial services and ATM services under GST ambit but the decision was recalled. Is there any confusion about the decision?

A: See, this is a new tax system and it is evolving. Any clarity on the subject will be reached with time.

Q: The second issue is related to pharma companies and FMCGs. They say slapping GST on products meant for marketing purposes is troubling them. What actions will be taken to solve the problem?

A: I will not be able to explain the specific case as I am not aware of the facts of the same. But, such companies can approach the advance ruling authority as well as the appellate authority with their pleas. These authorities are functional and hearings are going on at both levels.

Q:  In the recent past, you launched a GST refund drive. I would like to know about the kind of response that the drive saw? Are the problems related to exporters is slowly getting away?

A: Yes it is being solved. There were certain problems related to refunds and it was happening due to the automatic system, which forced us to tackle them manually. But, I feel the two refund drives were successful and has helped in solving several difficulties.