Indirect taxpayers’ count up 50% post-GST: Survey

Sanjeev Sharma

Tribune News Service

New Delhi, January 29

The Economic Survey for 2017-18 presented today has released data on employment and said India’s formal sector, especially formal non-farm payroll, is substantially greater than what it currently is believed to be.

The Survey noted that it became evident that when “formality” was defined in terms of social security provisions like EPFO/ESIC the formal sector payroll was found to be about 31% of the non-agricultural workforce.

When “formality” was defined in terms of being part of the GST net, such formal sector payroll share was found to be 53%, the Survey said.

The Economic Survey this year drew attention to some new economic facts on the Indian economy.

Goods and Services Tax (GST) has given a new perceptive of the Indian economy and new data has emerged. The Survey noted that there has been a 50% increase in the number of indirect taxpayers. There has also been a large increase in voluntary registrations, especially by small enterprises that buy from large enterprises wanting to avail themselves of input tax credits. Similarly, there has been an addition of about 18 lakh in individual income tax filers since November 2016.

The survey pointed out that tax departments in India have gone in for contesting against in several tax disputes but also with a low success rate which is below 30%. About 66% of pending cases accounted for only 1.8% of value at stake. It further stated that 0.2% of cases accounted for 56% of the value at stake.

The Survey also noted that growth in savings did not bring economic growth but the growth in investment did.

The Survey noted that on December 2017, there were 9.8 million unique GST registrants slightly more than the total indirect tax registrants under the old system (where many taxpayers were registered under several taxes). Therefore, adjusting the base for double and triple counting, the GST has increased the number of unique indirect taxpayers by more than 50% — a substantial 3.4 million.

Out of the total estimated 71 million non-agriculture enterprises, it is estimated that around 13% are registered under the GST.