Lok Sabha Question No. 3545 (UNSTARRED), answered on 2025-08-11
Subject: Indirect Tax Compliance and Reduction in Tax Evasions
Ministry: FINANCE
Asked by: Shri Anoop Pradhan Valmiki

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE LOK SABHA

## UNSTARRED QUESTION No. 3545

## ANSWERED ON MONDAY, AUGUST 11, 2025

## 'INDIRECT TAX COMPLIANCE AND REDUCTION IN TAX EVASIONS'

## 3545. SHRI ANOOP PRADHAN VALMIKI:

Will the Minister of FINANCE be pleased to state:-

- (a)  whether  the  Government  has  taken  any  steps  to  increase  the  indirect  tax  compliance  and reduce tax evasion, including monitoring of GST returns filed by taxpayers;
- (b) if so, the details thereof;
- (c) whether any technology is being leveraged in to enhance efficiency and simplify compliances in GST;
- (d) if so, the details thereof; and
- (e)  whether  the  Government  is  leveraging  advanced  technologies  such  as  AI,  ML  and  Data Analytics to monitor the compliance of GST and proactively detect any potential tax evasion?

## ANSWER MINISTER OF STATE IN MINISTRY OF FINANCE (SHRI PANKAJ CHAUDHARY)

- (a)  to  (d):  Yes,  the  Government  on  the  basis  of  recommendation  of  GST  Council  has  taken several measures from time to time to increase indirect tax compliance and reduce tax evasion. Some of the major policy measures taken by the Government are as under:

i.  Mandatory  Aadhar  based  authentication  for  new  GST  registrations  as  well  as centralised suspension of registrations of registered persons who default in timely filing of returns.

ii.  The  filing  of  statement  for  outward  supply  in  GSTR-1  has  been  made  mandatory before  the  filing  of  monthly  return  in  GSTR-3B  submission  for  the  same  period  since October 2022 to ensure accurate input tax credit (ITC) reporting and availment.

iii.  E-Way  Bill  generation  is  blocked  automatically  when  regular  taxpayers  fail  to  file GSTR-3B for two consecutive months.

iv.  GST refund applications are assigned risk ratings through data analytics, with highrisk refund claims undergoing detailed verification.

v. E-invoicing integration is implemented to enable automatic invoice reporting, input tax credit (ITC) reconciliation, e-Way Bill generation, and real-time compliance validation.

vi. Carrying out two nationwide special drives against unscrupulous entities for availing and passing on input tax credit (ITC) fraudulently on the strength of fake/bogus invoices.

vii.  Progressive reduction in threshold limit for issue of e-invoice for B2B transactions from Rs. 20 crore to Rs. 10 crore w.e.f from 01.10.2022 and further to Rs. 5 crore w.e.f from 01.08.2023.

(e):-  Yes,  the  Government  on  the  recommendation  of  GST  Council,  is  leveraging  advanced technologies  such  as  AI,  ML  and  Data  Analytics  to  monitor  the  compliance  of  GST  and proactively detect any potential tax evasion. The GST system uses advanced data analytics and artificial  intelligence  to  enhance  compliance  monitoring  and  to  prevent  evasion  of  tax.  Thus, based  on  data  analysis  and  risk  parameters  various  processes  under  GST  like  registration, scrutiny, and audit etc. target only high-risk taxpayers to avoid burdening compliant taxpayers. GSTN's  implementation  of  Machine  Learning  and  Data  Analytics  enables  department  to effectively monitor GST compliance while improving overall ease of compliance for taxpayers.

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