To check the creation of fake entities, the government is tightening the GST registration process by using biometrics.
The Central Board of Indirect Taxes & Customs (CBIC) is likely to continue its crackdown on fake entities and claimants of fake input tax credits (ITC) under the goods and services tax regime after the recent two-month drive alone uncovered more than 20,000 bogus entities, a senior government official said.
“It’s likely to be extended as the drive has given very good results. In the two-month drive, fake entities detected were 20,800. The fake ITC detected was at Rs 19,500 crore,”
Recoveries in such cases are time-consuming because the entities are fake and the beneficiaries have to be identified. The drive, carried out jointly by the Centre and the states, identified 60,000 units as risky.
ITC allows GST taxpayers to claim credit for taxes paid on inputs used in the production of goods or services. Fraudulent ITC is typically claimed by setting up fake companies, generating fake invoices, or inflating the value of invoices, depriving the government of revenue.
Original Published by:
