Amid GST rollout uncertainty, Infy bags IT network contract

Even as the possibility of implementing the proposed goods and services tax (GST) beginning next fiscal seems bleak, work on IT network for it is gaining momentum with IT giant Infosys being awarded the contract for building the network.

Official sources told The Indian Express that the goods and services tax network (GSTN), which was set up to provide IT infrastructure and services to the centre and state governments, tax payers and other stakeholders for rolling out GST, has awarded the contract worth Rs 1,380 crore to Infosys to build the system and maintain it for five years after becoming operational.

The company will build the IT interface for implementing the GST, which will make the country a single market by doing away with cascading effects of multiple levies that will help the taxpayers in core functions such as registration, filing of return and payment of tax.

It will also connect database of states with the centre and provide information technology infrastructure for seamless implementation.

“Business processes are being developed and finalised while software is yet to be prepared. We should be ready by early next year for the new indirect tax regime,” the official said.

Earlier five IT majors including Wipro, Infosys, Tech Mahindra, TCS and Microsoft had bid for building the GST network across the country. The government aims to roll out GST from April 1, 2016, an uphill task now given the fact that it has not been able to get the Constitution Amendment Bill, vital for the new indirect tax, passed in the Rajya Sabha due to concerns raised by the Opposition on certain provisions. For the bill to be passed, it needs two-thirds majority in both the Houses and needs to be ratified by 50 per cent of the states.

The request for proposal (RFP) was floated for goods and services tax network on April 21 and July 6 was the closing date for bidding. The company has been given time till March 31 next year to complete the project following which registration would begin.

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

Goods and services tax network would help in PAN-based (Permanent Account Number-based) 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 goods and services tax network. A sub-committee would decide on the sharing of the costs between the states.