Save your bills, get lucky with VAT dept

Soon shopping from a registered VAT shop or trader will entitle you to take part in a lucky draw with cash prize.

Starting January 18, the Delhi government is looking to capitalise on public power to supplement its surveillance on VAT evaders by encouraging people to collect bills at the time of purchase and send a bill copy to the department.

“The copy of the bill would be accepted through WhatsApp and the winners would get cash prize ranging up to 10 times of the bill amount,” said a senior VAT official.

We are calling it “Bill Banvao, Inam Pao” (Collect a Bill, win a prize) scheme, he said, adding that the scheme was conceived a few months ago but preparing the ground for it took some time.

The VAT department has about 20 teams, assisted by civil defence volunteers, to conduct checks on traders whose VAT filing evokes suspicion of evasion.

“These resources are not adequate to plug all loopholes so we are now involving the public to send the bills which would be verified by our team to find out if a particular outlet’s online system reflects the billing or not,” said an official.

If the bill issued to a customer is not reflected on the online server of the VAT department, it would mean that the outlet is evading tax.

“All that a lucky draw participant has to look for is that the bill that they are sending to us has a Taxpayer Identification Number (TIN) which confirms that the seller is registered in the VAT department,” said an official.

The “Bill Banvao, Inam Pao” is modelled on similar free prize scheme launched by the traffic police for pedestrians who use subways and fill a lucky draw coupon.

The scheme is a desperate attempt by AAP government, staring at a possible shortfall in VAT collection this financial, to improve tax filing compliance among traders.

Out of the total tax revenue of Rs 34,661 crore in 2015-16, the VAT department was tasked to collect Rs 24,000 crore – 69 per cent of the total revenue collections.
Despite a 30 per cent augmentation in surveillance in VAT evasion, the department has only managed to collect Rs 15,000 crore.

Since, Rs 2,400 crore would come from central tax pool, our real target is Rs 21,600 crore which are hopeful of meeting as there is usually a spike in VAT collections in the last quarter, said an official.

As per the tax revenue target, set by Finance Minister Manish Sisodia, VAT is supposed to contribute 69 per cent, excise 12 per cent, stamps and registration 11 per cent, tax on motor vehicles 6 per cent and luxury, entertainment and betting tax 2 per cent.

The impact of low VAT collections so far has been casting a shadow on government’s revenue and expenditure. The total expenditure of Rs 41,129 crore was planned to be financed mainly from the tax revenue of Rs 34,661 crore.

Till December, the government collected about Rs 21,820 crore revenue which was about Rs 12,841 crore short of the target.

The government had aimed for an increase in receipts of about 30.3 per cent this fiscal to take its receipts to Rs 41,550 crore. But so far only an increase of 14.5 per cent has been achieved in receipts.