Despite politics, GST backbone on course for target date

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Away from the public glare, a company set up by the government to create the logistical and IT backbone for the pan-India Goods and Services Tax (GST) regime will be ready to roll before the target date, as work didn’t stop even when political spats were delaying matters.

In fact, the Goods and Services Tax Network (GSTN) was set up as a non-profit, non-government company in March 2013 — at least a year before the latest bill was drafted for the Constitution amendment for migration to GST.

The results are there for all to see and reap, the stakeholders said.

“We’ll start testing by October,” GSTN Chairman Navin Kumar told, referring to stage one of this exercise where existing payers of indirect taxes will migrate to the new system and tests will begin on the crucial software for the move to the new regime.

“The hardware installation and software coding will happen by December. We hope to go for a beta run from February — which means our system should be ready by mid-February. The target date for the rollout is April 1 next year. Everything has to be ready before that,” Kumar added.

The company, which is based out of AeroCity on the outskirts of the capital, is uniquely structured: the Centre holds 24.5 per cent stake, the states and the Empowered Committee of Finance Ministers, as an entity, have another 24.5 percent, while the rest is with financial institutions.

Despite the political bickering over the bill, the company has been quietly working so as to be able to deliver by the April 1, 2017, target date. It went ahead last year to float the tender to hire an IT company to execute the hardware and software side of the project, and awarded the contract by November.

Some big names in the business, including Tata Consultancy Services (TCS), Wipro, Tech Mahindra, and Microsoft participated in the tender and ultimately Infosys — India’s second-largest IT Company — bagged the Rs 1,380-crore project for a five-year period.

The IT Company was mandated to build the technology infrastructure called the GST System Project (GSTSP) — a common portal for the use of tax-payers, administrators and other stakeholders with common services for registration, returns and payments.

Earlier this year, when the fate of the bill was in limbo, only the hardware procurement was put on hold. We told Infosys not to procure the hardware, but the software development was going on. We wanted to synchronise the developments with the live date for roll-out,” added Kumar.

The new regime will involve two sets of identical taxes — the central GST and the state GST. The rate of tax will be fixed by the GST Council, which will primarily be co-opted from the Empowered Committee of State Finance Ministers with Union Finance Minister as chairman.

“When we started out, we were to build the common GST portal and applications for registration of taxpayers, filing of returns and making the tax payments. Later, 21 states and union territories requested us to take care of their back-end as well, which we are also doing,” Kumar said.