Updated: May 2, 2022 5:38:37 am
Jharkhand has collected Rs 15,740 crore in financial year 2022 (FY22) as commercial tax amount, around 26 per cent more than the fiscal before, as per the details made available by the state’s Commercial Taxes Department. In Jharkhand, Commercial Taxes–which is Goods and Services Tax, VAT, Jharkhand Professional Tax (JPT) and Jharkhand Excise Duty(JED) – forms more than 70 percent of the tax revenue collected. In FY21 the collection stood at Rs 12, 500.29 crore.
The GST collection of the state, which includes state GST collection along with Integrated GST settlement plus an ‘ad-hoc settlement’, in FY21 stood at Rs 7,944.21 crore. The GST collection in the last fiscal increased by 22.14 percent to Rs 9703.12 crore. In the same period the non-GST collection which includes VAT, JPT and JED increased from Rs 4555.98 crore to Rs 6037.61 crore. In the same period, the GST compensation made to the state decreased while the loan to the state, in lieu of the GST compensation shortfall, increased.
The previous biggest jump in fiscal comparisons happened over FY 18 to FY19 — an increase of 18.4 percent.
Commercial Taxes Department Secretary Aradhana Patnaik said one of the main reasons for the increase in collection happened after the formation of the Intelligence and Revenue Analysis Unit (IRAU) streamlining the tax collections. mainly GST. This unit then cross-checked the voluntary declaration of the tax liability and did a sector-wise search. It identified variations in tax liability, among others.
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“The GST is a self-assessment tax regime where taxpayers voluntarily declare their turnover, liability among others and pay the tax after setting off the credit. At the same time in GST every data relating to the business activity available online through various reports. Because of this it becomes imperative to cross check both the data to identify the variations in tax liability and send it to the field formations for enforcement activity or scrutiny and with this objective IRAU was constituted…In the days to come it will enable more tax filings improving the fiscal condition,” Patnaik said. She added this led to target the ignored sectors and the taxpayers.
Tax revenue of any state consists of ‘State’s Share in Central Taxes’–which depends on the devolution by the Centre and transfer of amounts under the Finance Commission fund–and ‘Own Tax Revenue’, which consists of Commercial Taxes, Excise Duty, Transport, land revenue, among others. Commercial Tax in Jharkhand forms more than 70 percent of the state’s ‘Own Tax Revenue’.
Officials said at first the Commercial Tax Commissionerate was separated from the department in another building with additional manpower. Commercial Tax Commissioner Santosh Vatsa said the work of the IRAU included reverse analysis, which included sectoral analysis, profiling of the taxpayers giving red-flag reports.
An analysis of the work contractors revealed that after the payments were released by the respective government departments, a few of them showed ‘either nil return or under reporting of taxable turnover’. “This was evident from differences in filings by the government official and the contractor,” an official said.
Similarly, analysis of the mining sector revealed though royalty was paid by some and not all taxpayers to the mining department, but GST on that royalty i.e 18 per cent was not paid. Officials said that Rs 276. 53 crore was not paid, which was analysed and the department had collected a certain amount and is in the process of recovering the rest.
Vatsa added: “GST enforcement plays a very important part in getting all tax. Before it was left on the whims and fancies of the people and there was a significant misutilisation of Input Tax Credit, tax evasion among others. All players in the market were identified and we started tightening our grip and the situation improved,” he said. When asked whether it was ‘new revenue for the state’, Vatsa said: “That we don’t know, but there were many ignored tax payers and we have been able to some.”
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