GST Council approves converting GSTN into government owned entity
The 27th meeting of GST Council chaired by Finance Minister Arun Jaitley has approved proposal of convert GST Network (GSTN) into government entity from current private entity status by taking over stakes held by private entities. The council has agreed to buy out stake of private entities in GSTN. Following the move, central government will own 50% in GSTN and the remaining will be collectively held by state governments.
Majority of Goods and Services Tax (GST) processes including registration, filing of returns, payment of taxes, processing of refunds is IT driven and mainly through GSTN. For this, GSTN handles large-scale invoice level data of lakhs of business entities including data relating to exports and imports. Considering nature of state function performed by GSTN, it was felt that the network should be converted into fully government-owned company.
Goods and Services Tax Network (GSTN)
GSTN was set up as not for profit, non-Government, private limited company in 2013. It was established primarily to provide IT infrastructure and services to Central and State Governments, tax payers and other stakeholders for implementation of Goods and Services Tax (GST). Currently its 24.5% is owned by central government and similar percentage is held by state governments collectively. The remaining 51% I owned by five private financial institutions- ICICI Bank, NSE, HDFC Ltd, HDFC Bank and LIC Housing Finance Ltd. Its revenue model after Goods and Services Tax (GST) was rollout out consisted of User Charge to be paid by stakeholders who will use the system and making it self-sustaining organization.
Month: Current Affairs - May, 2018