CBIC set to Implement Automated Scrutiny of GST Returns Soon: Know More

Businesses need to exercise caution while filing returns as the Goods and Services Tax (GST) Automated scrutiny system is set to employ advanced artificial intelligence and data analytics to monitor discrepancies.

To improve taxpayer services in India, Finance Minister Nirmala Sitharaman has directed the Central Board of Indirect Taxes & Customs (CBIC) earlier to introduce automated Goods and Services Tax return scrutiny by this week. The Finance Minister had also instructed CBIC to increase the taxpayer base using technology-based solutions and take strict action against fake billing and Input Tax Credit (ITC) fraud.

The new system is expected to launch soon and will correlate data from various GST returns to identify any mismatches. It may also use information from other sources, such as bank accounts, payments, and invoices, to verify the GST return.

The system will be similar to the Income Tax department's Computer Assisted Scrutiny Selection (CASS), which sends an automated notice in case of any discrepancy in returns.

Taxpayers will have the opportunity to rectify returns if there are genuine errors. The GST department plans to employ more data analytics to improve compliance, and new functionalities have been introduced in the Advanced Analytics in Indirect Taxation (ADVAIT) system to allow deeper analysis of revenue and trends in export and import.

The system automates the process of scrutinizing GST returns and generates alerts in cases of non-compliance. This technology-based solution aims to enhance tax compliance, reduce manual intervention, and increase the efficiency of tax administration.

The use of data science models will help analyze outliers in both customs and GST regimes. However, businesses need to be more careful while filing returns as the automated system is expected to result in more scrutiny notices being issued.

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