Unique ID to be deployed to check GST evasion in select commodities

India will soon launch a Unique Identification Marking or UIM as part of a "track & trace" mechanism for select evasion-prone commodities such as tobacco products. Non-compliance by an entity will attract a penalty of ₹1 lakh or 10% of the tax payable.

The Goods and Services and Tax (GST) Council, which met Saturday, approved an amendment in the central goods and services tax act to provide a legal framework for developing the mechanism to trace specified commodities throughout the supply chain.

A specific definition will be incorporated in the law defining the Unique Identification Marking, which includes a digital stamp, mark or similar sign that's unique, secure and non-removable as may be notified by the government. A detailed procedure will be prescribed through rules under the provision after finalisation of the technology.


This follows a recommendation by a group of ministers set up to examine the possibility of levying GST based on the capacity of the manufacturing unit and introducing special composition schemes for evasion-prone sectors such as pan masala, gutkha, brick kilns and sand mining to plug leakages. This had been accepted by the GST Council in February 2023. The law committee of the council examined the issued and prepared draft changes to the law along the lines of the World Health Organisation that has formalised a track and trace system under the Protocol to Eliminate Illicit Trade in Tobacco Products. This requires the establishment of a global tracking and tracing regime within five years of its implementation.

Many countries have opted for such technological solutions to track and trace such products in the entire supply chain.

The UIM will enable determination of the date and site of manufacture; the machine used to make the item; the production shift or time of manufacture; the product description, quantity and maximum retail price.