The Finance Ministry aims to introduce pre-filled goods and services tax (GST) return forms before the upcoming fiscal year, addressing the challenge of significant data mismatches leading to unwarranted tax notices. The move is expected to enhance the ease of doing business and curb discrepancies in the GST system. The ministry is currently assessing the additional costs associated with reinforcing digital infrastructure to prevent system slowdowns or crashes when consolidating data from various databases.

Addressing Data Mismatches for Business Ease

A senior government official highlighted that the pre-filled consolidated GST return form is in progress and could be implemented before the next fiscal year. The initiative aims to combat the rising issue of data mismatches, which often results in unnecessary demand notices. Multiple templates are being employed in the development process.

Automated Scrutiny and Technological Analysis

The automated scrutiny module for GST returns presently sends notices to assesses when data mismatches exceed 20%, utilizing data analytics and system-identified risks. The Central Board of Indirect Taxes and Customs (CBIC) is currently evaluating the necessary technological upgrades, weighing the potential additional costs against the impact on system speed and response time.

Pilot Testing and Approval Process

Before full implementation, a pilot program will assess the functionality and time efficiency of the pre-filled GST return form. Notably, the initiative, focused on taxpayers’ convenience, doesn’t require GST Council approval to proceed, according to the official. The commercial question of acceptable additional costs versus benefits is under debate, emphasizing the need for a balanced approach to technological enhancements in tax processes.