The government is planning to widen its goods and services tax (GST) by tapping a section of mom-and-pop stores, a top tax official told Reuters on Thursday,
Also Read– BBC income tax survey in India offices comes to an end after nearly 60 hours
The moves comes as the government is looking to bring more elements of the economy into the tax net.
India has a large informal economy and the government has been trying to boost its tax revenues by including more of these activities.
The GST – which subsumed a host of state and central levies when it was introduced in 2017 – requires businesses with an annual turnover of Rs 4 million ($48,368) or more to be registered under the regime.
“We may adopt a sectoral approach in some sectors where we feel the taxpayer base is too slim compared to the size of the market,” Reuters quoted Vivek Johri, chairman of the Central Board of Indirect Taxes and Customs, as saying.
Read More: How To File Complaint Against Your Bank? Check What Is Banking Ombudsman Of RBI
The government is also working on a strategy with state governments and will seek their inputs to increase the base of indirect tax payers, said Johri.
The number of businesses within the GST net has increased to 14 million as of January 2023, from about 6 million in 2017, Johri said, seeing potential to further increase the taxpayer base under the GST regime.
One area is the business to consumer (B2C) space, he said, adding the government would use technology to target possible taxpayers without being unduly intrusive.
Read More: Is your Demat account dormant? Know the procedure to terminate it
The government will tap private databases and data available with various government agencies as it looks to shore up the tax base, Johri said.
