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A porous system originally intended to monitor tax compliance in cash-stressed Kerala has led to massive evasion ranging from ₹3,000 crore to ₹4,000 crore, according to Finance Minister Thomas Isaac.
Speaking to newspersons on Thursday, Isaac, who is busy working on the 2019-20 State budget, expressed the hope that the leakage could be contained by June with annual tax returns filings apace.
Fake billing
He said that the State does not currently have checkposts or other mechanism to verify e-way bills that could have helped check fake billing and underinvoicing.
The Finance Minister hoped that this would gradually get reversed by June when they start filing returns, helping shore up revenue collections. The State government proposes to step up tax collections by 20 per cent to 30 per cent.
Maharashtra, Andhra Pradesh, Telegana and Tamil Nadu have been able to realise more revenue since a lion’s share of the goods manufactured in these States are being consumed internally and hence there is no revenue loss.
Isaac said that the State government is reinforcing the back-end modules of the compliance monitoring system in order to plug the loss of revenue. Dedicated squads have been pressed into service for this but that alone may not suffice, he said.
Pravasi Chitty
Referring to the Pravasi Chitty designed for Keralites working or settled abroad, the Finance Minister said the turnover is expected to touch ₹25,000 crore during this financial year.
The chitty has been launched in association with the Kerala Infrastructure and Investment Fund Board (KIIFB). From the current turnover of ₹200 crore, a sum of ₹3.75 crore has reached the KIIFB, an extra-budgetary entity to mobilise development funds.
The contribution to KIIFB would grow once the chitty turnover goes up. Currently, the chitty is operational only in the UAE, but it will be extended to all GCC nations soon before being taken to other countries.
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