Technology is the backbone of Indian GST and it plays an important role in ensuring tax compliance across a country supporting a population of over 1.33 Billion.
Goods and Services Tax Network (GSTN) was setup as a non-Government, private limited company on March 28, 2013 with private players being given 51% stake.
GSTN for the first time in history of India was required to establish a uniform interface for the taxpayer and a common and shared IT infrastructure between the Centre and States. Previously, the Centre and State indirect tax administrations worked under different laws, regulations, procedures and formats and consequently the IT systems work as independent sites. Integrating them for GST implementation was a massive task which was to be completed in required time.
Goods and Service Tax compliance structure is designed in a manner to capture the invoice-level details. The paper submissions are eliminated completely as all returns by taxpayers and orders by tax authorities need be issued in paperless environment only. E-filings ensure there is no possibility of putting back-date entries or changing documents or information at a later stage without following the prescribed procedure under law. Limited possibilities to circumvent laws lead to limited opportunities to engage in corrupt practices.
GSTN acts as a depository of information. No government authorities like RBI, Income Tax department, Stamp Duty authorities, VAT authorities, Excise authorities, etc. ever had so much data as is available with GSTN. In this era, information would lead the next revolution and thereby its importance cannot be ignored off. In times to come we expect that information with GSTN will be shared with other regulatory authorities ensuring higher corporate governance in long run.
We also expect that data will be shared with banks, enabling them to identify the defaulters such as Nirav Modi, Vijay Mallya, etc. With the availability of such information, banks would be able to tackle the situtaiton of NPA’s.
Interlinking of GST data and Aadhar will help the authorities to track the transactions which were unable to be tracked in the erstwhile regime.
One of the major challenges faced by the GST authorities was the implementation of e-way bill mechanism, which got extended due to unpreparedness. Later E-way Bills system was implemented on the back of robust technology implemented by Nation Informatics Centre. Besides many advantages of e-way bill mechanism like lesser documentation, cost reduction, efficient transportation, etc., it is beneficial in solving the larger problems being faced by Indian authorities like tax evasion, seamless inter-State transportation of goods, loss of time at check-points. E-way bill system had made significant contribution in boosting the GST revenue for the country.
Like the famous saying by “Where there is a will there is a way”. Indian political scenario started discussing GST in 2006, and it took them over a decade to see it in reality, but our political honchos need to be congratulated that they never lost sight of this important change in the indian economy.
We expect Indian economy will ride high on technology supported GST, this is well evident from the ranking of India in Ease of doing business category published by World Bank. Earlier, India was ranked 142 out of 189 economies, and now, we stand strong at 77, making India the highest ranked South Asian nation. Factors like online tax compliance, declaration of invoice-wise sales, electronic cross-matching of sales and purchases, robust IT structure by GSTN and dual control by center and states will minimize the scope for any type of corruption, tax evasion or generation of black money. Implementation of GST and usage of robust technology would ensure a brighter and better future for the generations to come in this country which is expected to lead the next revolution on the back of a huge human capital supported by technology literate people.
About Rajat Mohan
Rajat Mohan is a Chartered Accountants by qualification and GST consultant by profession. He is the senior partner in AMRG & Associates serving various multinationals on the subject. He has authored more than half a dozen books on indirect taxes, GST being his forte. He is a regular contributor of articles and comments which are published on several online portals and in the columns of reputed tax journals and magazines. His views are well respected by media which is the reason that his name is placed regularly in national dailies and top-notch online news portals including Times of India, Economic Times, Hindustan Times, Indian Express, The Hindu, LiveMint, Hindu Business Line, Business Standard, Bloomberg, Business Today, Financial Express, Firstpost, NDTV, ETRetail, Monday News Alerts and various others
