NEW DELHI: Seen as a concerning development, tax evasion under the Goods and Services Tax (GST) regime has surged to a staggering Rs 2.01 lakh crore for the financial year 2023-24, nearly doubling from Rs 1.01 lakh crore in the previous fiscal year. This alarming increase, as reported by the Directorate General of GST Intelligence (DGGI), underscores the growing challenge in GST enforcement and the urgent need for stricter measures to curb this trend.

The DGGI report has identified the online gaming and banking, financial services, and insurance (BFSI) sectors as the most susceptible to GST evasion. The online gaming sector alone accounted for a massive Rs 81,875 crore in evasion, while the BFSI sector saw Rs 18,961 crore. Among goods, the iron, copper, scrap, and alloys sectors faced Rs 16,806 crore in evasion, with pan masala, tobacco, cigarette, and beedi following at Rs 5,794 crore as detailed in a PTI report.

Mumbai has emerged as the highest zone for GST evasion detection, with a total of Rs 70,985 crore, followed by Delhi at Rs 18,313 crore, Pune at Rs 17,328 crore, Gurugram at Rs 15,502 crore, and Hyderabad at Rs 11,081 crore. This concentration of evasion in major metropolitan areas highlights the need for enhanced monitoring and enforcement measures in these regions.

The breakdown of evasion types showed that non-payment of tax, including clandestine supply and undervaluation, constituted 46 percent of cases, followed by fake input tax credit at 20 percent and wrong or non-reversal of ITC or blocked credit at 19 percent. These findings underscore the various methods employed by businesses and individuals to evade their tax obligations.

Since the introduction of GST in 2017, detected evasion has been steadily increasing, with previous figures of Rs 7,879 crore in 2017-18, Rs 19,319 crore in 2018-19, Rs 21,739 crore in 2019-20, Rs 31,908 crore in 2020-21, and Rs 50,325 crore in 2021-22. This consistent upward trend highlights the need for continuous improvement in GST enforcement mechanisms and the implementation of robust anti-evasion strategies.

The alarming rise in GST evasion, reaching over Rs 2.37 lakh crore across 20,576 cases in FY24, has prompted calls for stricter regulations and enhanced enforcement measures. Experts emphasize the importance of tightening regulations across sectors, particularly in the online gaming and BFSI industries, to prevent further losses to the national exchequer.

As the government works to address this pressing issue, businesses and individuals are urged to comply with GST regulations and contribute their fair share to the nation's economic growth. The successful implementation of anti-evasion strategies and the cooperation of all stakeholders will be crucial in curbing this concerning trend and ensuring the effective collection of GST revenues.