Srinagar, Oct 3: While the recent Goods and Services Tax (GST) reforms, including rate cuts on essentials and simplified return filings, have been widely appreciated across industries and consumer groups, tax experts warn that misuse of Input Tax Credit (ITC) and other evasion tactics could undermine the benefits of the reforms.
Sources reveal that in sectors such as cement and automobiles, some manufacturers may be underreporting production to evade taxes, selling excess output without proper invoicing. Such practices not only manipulate ITC claims but also result in significant revenue losses for the government.
Industry insiders point out that while the reforms ease compliance, monitoring mechanisms need strengthening to prevent potential fraud. The automobile sector, in particular, has faced classification disputes and ITC misuse in the past, highlighting the need for continuous vigilance.
Experts stress that authorities must investigate and clamp down on irregularities, ensuring that GST reforms achieve their intended goal of lowering costs, improving compliance, and safeguarding government revenue.
With billions of rupees at stake, vigilance on ITC claims is now crucial to protect both taxpayers’ interests and the public exchequer.
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