Thiruvananthapuram, June 15 (IANS). Kerala Chief Minister V.D. Satheesan on Monday discussed a detailed financial roadmap presented by the state’s former Principal Accountant General Dr Biju Jacob. The roadmap suggests that the state can increase its revenue by using advanced data analytics and information systems (IS) audits instead of imposing new taxes.
Dr. Biju Jacob made this presentation before the Chief Minister in the presence of senior officials of the Finance and Tax Department. The meeting comes at a time when Kerala has a public debt of more than Rs 5 lakh crore and the Chief Minister is scheduled to present his first budget on June 19.
The former top audit official told IANS that the Chief Minister listened to him seriously and showed deep understanding of the subject.
Biju Jacob said Kerala’s biggest challenge is not the lack of new revenue sources, but the inability to fully collect the taxes that the state is legally supposed to collect.
“My suggestion focuses on identifying those taxpayers and tax-base which are outside the scope of the current assessment system. This requires technology-based investigation and analysis,” he said.
Citing an Information System (IS) audit study conducted in 2014, he said the sample analysis had identified additional potential tax revenue of Rs 12,282 crore against the actual tax collection of Rs 22,414 crore under KVAT, KGST and CST, which was about 55 per cent of the total collection.
Biju Jacob said that if the complete data was analyzed, the difference could have been even greater.
He proposed a comprehensive technology-based IS audit, which would include identification of fake registrations, detection of network of shell companies, investigation into cases of trade concealment, discrepancies in e-way bills, discrepancies in GST and Income Tax data, suspicious refund claims and review of ERP audit trails.
Jacob also mentioned the big GST scams that have surfaced in Kerala. Among these, a case of fake registration and input tax credit (ITC) fraud of Rs 1,170 crore and another case of tax evasion of Rs 580 crore were mentioned.
He told the Chief Minister that a joint audit team of tax officials, Comptroller and Auditor General (CAG) experts and chartered accountants could complete such an audit within a few months and identify recoverable amounts worth crores of rupees.
–IANS
SAK/DKP
