Unmasking Tax Evasion: GST's Battle Against Fraudulent ITC Claims
GST officers detected fraudulent ITC claims worth Rs 15,851 crore in the first quarter of FY26. Despite fewer fake firms identified, the fraudulent amount increased by 29% from the previous year. Measures include stringent registration processes and legislative provisions to combat ITC fraud and tax evasion.
- Country:
- India
In a significant development, GST officers have uncovered fake input tax credit (ITC) claims amounting to Rs 15,851 crore during the April-June quarter of the current fiscal year. This fraud represents a 29% increase compared to the same period last year, despite a reduction in the number of fake companies detected, according to officials.
Data shows that 3,558 fake firms were identified by central and state GST officers, down from 3,840 in the previous year. A panel chaired by Goa Chief Minister Pramod Sawant is investigating tax evasion in specific sectors and exploring methods to mitigate ITC fraud.
The clampdown has also resulted in 53 arrests and the recovery of Rs 659 crore. Moving forward, the GST registration process has been made more robust to prevent future fraud, with physical verification and Aadhaar authentication becoming mandatory checks for applicants deemed risky through data analytics.
(With inputs from agencies.)
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