The Model All India GST Audit Manual 2023 has been finalized for use by both the Centre and state tax officials. It aims to benefit businesses and reduce litigation by providing standard principles for the selection, preparation, and conduct of audits, as well as post-audit follow-up. The manual emphasizes the need for a common platform to share audit findings and relevant information, capacity building and training of officials, and focused training in sectors such as e-commerce, works contract, hospitality, and banking.

Currently, the multiplicity of audit procedures by the Centre and different states, with varying parameters, requirements, and timelines, has been a concern for businesses. Audits have gained prominence, with notices being sent to taxpayers by both the Centre and state GST departments. Audits are expected to play a crucial role in increasing the GST taxpayer base and reducing tax evasion.

To facilitate coordination, an All-India Coordination Committee of Officers will be established, comprising officers from the Centre and states. This committee will select audit themes, form committees for thematic audits, develop a common minimum audit plan, monitor audits, and share outcomes as per the manual. Technological tools developed by the Centre and state governments will assist in the audit processes.

The audit manual serves as a comprehensive guide for both taxpayers and audit teams, helping taxpayers identify required documents in advance. It recommends a uniform selection process for audit cases based on weighted criteria, considering parameters from Form GSTR-3B, Form GSTR-1, and secondary data sources. The final selection is made based on the descending order of calculated scores, while some cases may be selected randomly or based on local parameters and past behaviour.

For follow-up audits, if the tax, interest, penalty, or other dues determined from the final audit report are not paid within 30 days, the case will be referred to the respective jurisdiction for demand and recovery proceedings.