Call Us Now

+91 9606900005 / 04

For Enquiry

legacyiasacademy@gmail.com

USING DATA ANALYTICS TO IDENTIFY GST EVADERS

Why in news?

Inverted duty structure discourages, The department of revenue has identified as many as 931 cases of fraudulent GST refund claims

Details

  • Input tax credit(ITC) frauds are most common way to evade GST
  • Shell companies and fly by nights entities are being used for fake ITC

Inverted Duty Structure Discourages

  • IDS, refers to taxation of inputs at higher rates than finished products that results in build-up of credits and cascading costs.
  • When the import duty on raw materials is high, it will be more difficult to produce the concerned good domestically at a competitive price.
  • Several industries depend on imported raw materials and components.
  • High tax on the raw materials compels them to raise price. On the other hand, foreign finished goods will be coming at a reduced price because of low tax advantage.
  • Thus, manufactured goods by the domestic industry become uncompetitive against imported finished goods.
  • The disadvantage of the inverted duty structure increases with the increased use of imported raw materials.
  • An IDS, discourages domestic value addition.
Download PDF
December 2022
MTWTFSS
 1234
567891011
12131415161718
19202122232425
262728293031 
Categories