Brought GST under PMLA purview to fighting financial fraud: Centre

According to revenue secretary Sanjay Malhotra, the recent decision by the government to bring the Goods and Services Tax Network (GSTN) under the Prevention of Money Laundering Act (PMLA) was aimed at empowering investigative agencies to address tax fraud and money laundering cases, rather than granting unrestricted access to data for any party. He clarified that the notification from the finance ministry would only provide additional information to tax authorities.

The GSTN serves as a recipient of information and does not share any data with the Enforcement Directorate (ED) through this notification. The Director of the Financial Intelligence Unit (FIU) will provide information to authorities to strengthen their efforts against tax evasion and money laundering wherever necessary.

On Saturday, the central government issued a notification to bring the GSTN under the purview of the PMLA. This step enables sharing of information stored on the GST Network as required under the PMLA Act.

Also Read- GST Council: 28% tax on online gaming, casinos and horse-racing

Meanwhile, the Delhi National Capital Territory government has opposed the move by the central government to include the GSTN under the PMLA and has called for a discussion on the matter. Atishi, the Revenue Minister of Delhi NCT, highlighted concerns that this decision could lead to prosecution by the ED under the PMLA for those paying GST, based on allegations of fraud.

She mentioned that several other Finance Ministers, including those from opposition-ruled states, raised the same issue during the GST Council meeting. Atishi expressed opposition to this move and demanded a discussion, but the central government and Finance Minister Nirmala Sitharaman, who heads the GST Council, were not open to the discussion during the meeting held on Tuesday.

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