BENGALURU: A year after the roll out of the Goods and Services Tax (GST), the competition among companies to become GST Suvidha Providers (GSPs) to route invoice filings to the central system has fizzled out. According to a source in the GST Network, of the 70 shortlisted GSPs only about 25 are active, with even big names such as Tally remaining inactive.
A GSP offers a gateway to taxpayers to the GST Network by getting access to the APIs for uploading of invoices and filing returns. Some industry players have put the number of active GSPs lower at about 15.
Even some of the companies who are relatively active as GSPs have made losses on their investments in the technological back-end and marketing. One such company, which is an active GSP but did not wish to be identified, has made only 10% of the Rs 25 crore revenue it was expecting from this business annually.
The limited impact of GSPs on the 1 crore taxpayer ecosystem under GST is also evident through the number of invoices routed through them. Of the 370 crore invoices received by the GSTN in the past year, about 100 crore have been routed through GSPs, the source cited above said, adding that the GSPs such as Tata Consultancy Services, Reliance Corporate IT, Karvy, Vayana Private and IRIS have routed the most number of invoices.
The GSTN is set to delist the inactive ones and approach other companies interested to become GSPs. According to the source, the agency has already sent communication to these companies two months ago seeking a status on their readiness.
However, some companies who were shortlisted as GSPs have cited the frequent changes in the GST regime, the shaky portal of the GSTN, as well as simplification of filings as the main reasons for not seeing a big opportunity as they had envisioned earlier.
Bharat Goenka of Tally cited the weak technology infrastructure of GSTN to handle queries around invoice matching as well as the technical challenges involved in being a GSP as the reasons for staying behind.
“As a GSP, we would have to ensure we provide correct invoice matching to our clients, which would require that we would have to make high frequency queries to the GSTN. However, we were unsure of the ability of the GSTN to withstand the traffic of queries and to show the data,” ” Goenka told ET. Goenka, however, said that while they have received communication from the GSTN for being inactive, Tally is working with the agency on solutions to build more efficient APIs and creating light queries.
One of the reasons for several GSPs to have lost their edge is also the simplification of the process by GSTN, which has actually been beneficial for taxpayers, according to industry members.
The government suspended certain complex forms such as GSTR 2 meant for reconciliation of purchases, which has meant that many taxpayers do not have to rely on companies offering software solutions and hence also prefer to file the invoices online by themselves, which is also free of cost compared to the charges of around Rs 2,000-3,000 per annum being charged by some of the GSPs.
“It is good that the government is trying to make compliance simpler for taxpayers, since you need more people complying to later bring them under a more structured system,” said Ankit Agarwal, managing director of Alankit, which is among the active GSPs.
However, several companies shortlisted as GSPs do not see a big market opportunity as was envisioned.
“The rules under GST were changing so frequently that it was difficult to keep adapting to the technology,” the CEO of the company that made losses on its investments said.
Industry members also said that only those who gave additional value-added services as application service providers (ASPs) would be able to sustain. “Being a GSP-ASP requires domain knowledge in taxation and is not just a pure tech play. That is where many players were not able to match up to the requirements,” said Harishanker Subramaniam, national leader for indirect tax services, EY.
However, the number of active GSPs is expected to rise slightly with some players selected in the second batch going live only recently.
KPMG went live as a GSP only this month while Zoho is also expected to go live soon.
Read more at:
//economictimes.indiatimes.com/articleshow/64787878.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
//economictimes.indiatimes.com/articleshow/64787878.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
By Mugdha Variyar, ET Bureau|Jun 29, 2018, 08.45 AM IST
Used for Educational Purposes only
No comments:
Post a Comment