Shillong: The Meghalaya government has launched a crackdown on tax non-compliance to stop significant revenue leakage. An order issued by Sibhi Chakravarthy Sadhu, Secretary of the Excise, Registration, Taxation and Stamps department, requires all state agencies, societies, and departments to strictly follow Tax Deduction at Source regulations.
Investigations revealed that many departments were engaging contractors and suppliers without registering as tax deductors. This oversight meant the mandatory 2 per cent tax was not withheld from payments, allowing some contractors to avoid their tax liabilities entirely. To fix these gaps, the government is now requiring all unregistered agencies to secure GST registration immediately.
Under the new rules, departments must deduct 2 per cent TDS on all government supplies and contracts valued over Rs 2.5 lakh. These deductions must be reported via Form GSTR-7 by the 10th day of the following month. For smaller contracts, departments are still required to report details to the Office of the Commissioner of Taxes. Contractors must also provide a Tax Clearance Certificate from the Superintendent of Taxes before being awarded any new work.
The government stated, "any violation will be viewed seriously," and warned that officials will be held personally accountable for any revenue losses caused by negligence. This move ensures tighter financial oversight across all state-led procurement activities.
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