Govt Detects Rising GST Evasion, but Recoveries Lag Behind

Last updated: 11 December 2023

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The Indian government has detected a significant rise in Goods and Services Tax (GST) evasion, with figures escalating year on year. Despite increased detection, the amount of evaded tax being recovered has fallen sharply, particularly in the current fiscal year. Maharashtra has been identified as a major contributor to the detected evasion, highlighting a growing concern for the nation's fiscal health and the effectiveness of current tax enforcement measures.

Rising GST Evasion Challenges Government: Maharashtra Dominates, Recovery Lags Behind Detection The Ministry of Finance revealed alarming statistics in Parliament this week, shedding light on the escalating challenge of Goods and Services Tax (GST) evasion in India. Despite a consistent increase in the detection of GST evasion each year, the recoveries have failed to keep pace with these findings, creating a growing concern for the fiscal health of the nation. Maharashtras Outsize Role

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FAQ :

The main concern is that while the detection of GST evasion is increasing each year, the amount of tax being recovered is not keeping pace, leading to a growing gap between evaded and recovered amounts.

Maharashtra has emerged as a significant contributor to the detected GST evasion, both in absolute terms and in relation to its share of tax collections.

The recovery rate has decreased significantly. In FY 2019-20, approximately 45% of detected evasion was recovered, but by FY 2022-23, this figure dropped to only 25%.

For the first seven months of the fiscal year 2023-24, the recovery rate for identified GST evasion has lagged significantly, standing at just over 12 percent.

In the financial year 2022-23, the government uncovered a staggering Rs 1.3 lakh crore in GST evasion.

In the first seven months of the fiscal year 2023-24 (April-October 2023), a total of Rs 1.5 lakh crore in GST evasion has been identified.

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CCI News Desk

Finance news reporter covering taxation, GST, income tax, business compliance, and economy updates. I simplify complex financial topics into easy-to-understand articles for professionals, taxpayers, and business owners on leading finance and tax platforms.

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