Karnataka govt to step up audit & inspection of e-commerce players

NT Correspondent

Bengaluru: Asserting that the government will take measures to plug leakages with respect to GST collection in the state, Karnataka Law and Parliamentary Affairs Minister H K Patil on Friday said audit and inspection of e-commerce players will be increased.

The Minister said this while piloting the Karnataka Goods and Services Tax (Amendment) Bill, 2023, for the consideration of the Legislative Assembly. It was subsequently passed.

"Tax payers in Karnataka during VAT era were 5,80,000, today during GST period it has increased to 10 lakh, so about 4.2 lakh taxpayers have come under the tax net. Karnataka has displayed an increasing trend in GST collection from Rs 44,816 crore in 2017-18 to Rs 81,848 crore in 2022-23. GST has immensely contributed towards an increase in our budget size and revenues," Patil said.

He said, "There is a perception that tax evasion is more in the service sector, but 56 percent of our contribution is from the service sector."

BJP leader and former Chief Minister Basavaraj Bommai, Congress MLA Shivalinge Gowda, JD(S)' H D Revanna among others highlighted instances of GST/tax evasion, and urged the government to take measures in this regard.

The Minister said the government will take all necessary measures to plug GST leakages. "11,733 cases were inspected last year (2022-23) Rs 1,320 crore has been collected in the form of tax penalty. This is not a small amount, but still more measures have to be taken," he said, adding that honest efforts have to be made by officials in tax collection.

Pointing out that a drive had been conducted in the state against "bogus dealers", the Minister said 1,600 cases were detected and about Rs 90 crore ITC (input tax credit) were blocked.

There is a need to take more such measures, and the government will do it, he said, adding, "Also, audit and inspection of e-commerce operators will be increased."

The Karnataka Goods and Services Tax (Amendment) Bill, 2023, was introduced with the aim to overcome difficulties in the levy and collection of tax on the intra-State supply of goods or services or both by the State government.

Piloting the bill for the consideration of the House, Patil said, the amendment bill will bring in 22 amendments to GST law out of which six are dealer-friendly measures and 16 are for ease for tax compliance and administrative measures.

The bill intends to include penal provisions applicable to e-commerce players in case of contravention of provisions relating to the supply of goods and services made through them by unregistered persons or the composition of taxpayers.

The Bill also aims to decriminalise offenses by increasing the monetary threshold from Rs 1 crore to Rs 2 crore except for offenses related to the issuance of invoices without a supply of goods or services or both.

The Assembly on Friday also passed Karnataka Transparency in Public Procurements (Amendment) Bill, 2023.