GST under PMLA can be another scope for ED to harass, says Delhi Minister Atishi

After the 50th GST Council meeting, Delhi Minister Atishi said that the issue of why GST was brought under PMLA was discussed in the meeting.

She said, "A very important was raised by several Finance Ministers, including that of Delhi - why GST has been brought under PMLA. A gazette was issued on July 7 as per which the entire GST system was brought under Prevention of Money Laundering Act. It means that those who pay GST can now be prosecuted by ED under PMLA."

"We have seen how ED is used to harass & arrest people. We oppose this, we demanded a discussion. But the Centre & FM Sitharaman are not ready for a discussion on the same," she added.


Punjab Finance Minister Cheema said, GST under PMLA ambit is "a huge threat to small traders and may lead to tax terrorism."

The government had brought the Goods and Services Tax Network (GSTN) under the Prevention of Money-laundering Act (PMLA), as per a notification dated July 7. The decision was taken by centre to plug tax evasion through fake billing. GSTN handles the technology backbone of the indirect tax regime and is the repository of all GST-related information, including return, tax filing and other compliances.

Finance Ministry had amended a 2006 notification to facilitate sharing of information between the GSTN, Enforcement Directorate and other investigative agencies.

The ammendment was made for provisions under Section 66 of the PMLA, which provides for the disclosure of information.

The GST Council is chaired by the Union Finance Minister and comprises ministers from every state and Union Territory.