The Government collects tax breaks at each stage making it a long supply chain where the government charges tax on each stage but in the case of unregistered sellers, the Government does not get the taxes on the last stage.
“CBIC is looking to increase the number of taxpayers to achieve that we are working jointly, figuring out the strategy which will work the best in achieving the goal,” Vivek Johri said in an interview.
“The current no. of taxpayers in the GST base is around 14 million and if we look at the figure of other taxes let’s say income tax which is having a taxpayer base of 80 million. This indicates scope for increment in the number of taxpayers based on GST” said Johri.
The threshold for businesses to get GST registration is rupees 40 lakhs in sales but to do interstate trade GST registration is required irrespective of its level of sales.
As per official data, India has over 63 million unincorporated, non-agricultural micro, small and medium enterprises, 99% of which are in the micro sector, defined as having sales of up to ?5 crores.
If we compare this data to the number of GST-registered taxpayers which is around 14 million it indicates a definite sign that many newer GST-registered taxpayers could be added to the regime. And making them part of the indirect tax base will have a measurable impact on improvement in tax collection.
CBIC is working to build up the audits, said Johri. The indirect tax administration is now conducting audits of the initial years of GST, which has picked up Stream.
If you need any clarification regarding the GST and its compliances for taxpayers, feel free to contact the ASC Group.
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