Microsoft, TCS, 3 other IT firms bid to build GST Network

Five IT companies, including Microsoft, TCS and Infosys, have bid for building the GST Network (GSTN) across the country for a smooth roll out of the new indirect tax regime.

"We have received five bids for building the GSTN system.

We will finalise (the bidder) by the end of next month," GST Network Chairman Navin Kumar said at a interactive session organised by Ficci. Kumar refused to reveal the names of the bidders.

According to sources, meanwhile, the five companies which have bid for the project are TCS, Wipro, Infosys, Tech Mahindra and Microsoft.

The government plans to implement the single rate GST, which would subsume central excise, service tax and other local levies, from April 1, 2016.

The government had floated the Request for Proposal (RFP) for setting up GSTN on April 21; July 6 was the closing date for bidding.

A strong technology backbone is essential for successful roll-out of single rate GST across the country.

GSTN is a company formed to connect databases of states with the Centre, and provide the information technology (IT) infrastructure for seamless implementation of GST.

Kumar further said that registration on GSTN would start by January 31, to prepare for a smooth roll out by April 2016.

"For registration, the target is to get it ready by January 31 so that there is two months time for testing. And payment and returns will follow months later, because the first return will be filed only in May," he said.

GSTN would help in PAN-based (Permanent Account Number) registration of traders, besides filing of tax returns and payment system.

The Centre and the states have also agreed to equally share the costs incurred by GSTN. A sub-committee would decide on the sharing of the costs between the states.

For handling backend operations, 13 states have approached GSTN for creating the IT platform, while rest of the 17 states are developing IT network on their own.

Kumar said the 13 states include UP, Bihar, Odisha, Delhi, five North Eastern states, Himachal Pradesh, Uttarakhand, Puducherry and Chandigarh.

Kumar said the states that fail to set up their own IT network in time, the GSTN would be ready to assist them later.

"Those traders who would be new, they would have to be registered. Those who are existing, for them we will update from VAT, Service Tax, excise and migrate their data. There will  be one unique ID for the trader across the country," Kumar said. 

Model GST law is being drafted, says government

The government remains committed to roll out the Goods and Services Tax (GST) from April 1, 2016. 

Currently, a Central GST Law and a model legislation for states is being drafted to levy GST on intra-state supplies; on inter-state supplies and levy of GST on imports. 

The GST Council would be constituted after the enactment of the Constitution Amendment Bill which is currently with the Select Committee of the Rajya Sabha, said V S Krishnan, Member - Service Tax and GST, Central Board of Excise and Customs (CBEC), Ministry of Finance, in an interface with media at FICCI Federation House.

He added that the reports of various committees/sub-committees on place of supply rules, IGST model and business processes relating to registration, refunds, returns & payments were awaiting approval. 

Krishnan said that the issues under discussion were rates of CGST, IGST and SGST; threshold limits of exemptions and compounding; list of exempted goods and services; transitional provisions for treatment of accumulated CENVAT credit; dispute resolution mechanism; distribution of responsibility between centre and state in implementing the three pillars of the compliance verification system, return scrutiny, audit and anti-evasion.

Navin Kumar, Chairman, GSTN, said that the GST Automated System will be one-stop-shop for the key needs of taxpayers of the entire nation. The mandate of GSTN is to provide shared IT infrastructure and services to central and state governments and taxpayers for the implementation of GST. He added that implementation of GST needs a strong IT infra and services backbone, which enables capturing, processing and exchanging of information amongst stakeholders (taxpayers, state, central government, banks and RBI).

Kumar said that GST rollout strategy provides two options to the state governments for creating GST infrastructure. In the first model, States/CBEC would develop their own backend modules and exchange data with GST common portal using APIs over a secured network. In the other, GSTN would develop backend modules for states and host the same at central data centre location. 13 states have exercised the option to use the backend systems of GSTN.

Congress, Left to give dissent on GST; Rajya Sabha panel to adopt GST report on Monday

Congress and left parties are likely to file dissent notes on the report of Rajya Sabha Select Committee on GST as the panel gears up to endorse the majority provisions of the bill on Monday.

According to sources, the panel met on Friday and completed the consultation process. A clause-by-clause discussion took place on the Constitution Amendment Bill to roll out GST.

A draft of the report would be circulated to the members shortly, sources said, adding that the panel will meet on July 20 to "consider and adopt the draft report on the bill".

As per the schedule, the report is to be submitted to the Rajya Sabha by July 24, within days of commencement of the monsoon session of Parliament. Congress and left parties are preparing dissent notes, sources added.

The main opposition party in the Upper House is preparing a dissent note saying it cannot support a bill which is not "simple and comprehensive".

While Congress is in favour of the proposed indirect tax regime, it wants a ceiling of 18% on the GST tax rate.

It is also against the power to states to levy 1% additional tax as it would have a cascading effect and cause market disruptions.

GST bill has been passed by the Lok Sabha and was referred to the Select Committee by the Rajya Sabha, where the ruling NDA government does not enjoy majority. The government aims to roll out GST from April 1, 2016.

Sources also said Congress wants the Centre''s representation in the GST council, which will oversee the implementation of the new tax regime, should be reduced and states voice should be increased to three-fourth. Also, the Congress wants that tobacco, alcohol and electricity supply should be brought in the ambit of GST.

The GST bill proposes compensation to states for five years for their revenue losses, but the Congress wants a GST Compensation Fund under the supervision of GST Council should be set up.

Since it is a constitution amendment bill, it requires to be passed with two-third majority in Rajya Sabha. It will also have to be ratified by 50% of states.
The Select Committee is headed by Bhupender Yadav (BJP).