Quick Summary
The rapid expansion of digital payments in India has brought a surge in tax evasion cases, particularly among small online merchants. The Directorate General of Goods and Service Tax Intelligence (DGGI) has stepped up efforts, working closely with startups, payment aggregators, and payment gateways
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FAQ :
Authorities are addressing tax evasion by small online merchants who use digital payment channels to hide the true nature of their sales and avoid paying correct GST.
Some merchants register to sell low-tax goods but then switch to selling high-tax items like betting or gaming services, or use payment IDs linked to unrelated services to conceal transactions.
Payment aggregators are urged by the RBI to enhance their ongoing monitoring of merchants, especially when transaction patterns change, to help prevent tax evasion.
Advanced AI tools are used to scan platforms, transaction data is analysed, SKUs are scanned, and test transactions are conducted to identify non-compliant merchants.
The scrutiny on online merchants is expected to intensify as digital payments continue to grow, with increased collaboration between tax authorities and payment platforms.
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