GST Network to start collecting traders’ data for issuing tax IDs

The network that forms the information technology backbone of the goods and services tax (GST) will start a nationwide drive, in collaboration with state governments, to collect information on around eight million traders and issue them tax identification numbers (TIN) as India prepares to implement the tax from the next fiscal year.

The Goods and Services Tax Network (GSTN), as it is called, has already collated basic information like Permanent Account Number (PAN) and names from existing databases of the income-tax department but needs more detailed data like place of operation, nature of business and bank account details before it can issue a GST ID number to the traders.

All traders will need a GST ID number—a 15-digit PAN-based number—to operate under GST, which is expected to come into effect on 1 April 2017.

As per GSTN estimates, there are around 6.5 million VAT (value-added tax) dealers registered with state tax authorities, and around two million service tax and about half a million excise duty dealers registered with central authorities.

Even if there is an overlap between dealers registered with the centre and the states, GSTN estimates there will be more than eight million traders who will need to be issued GST ID numbers.

“We are making a software where the existing taxpayers can fill essential data, like place of business, name of directors, the nature of their business and bank account details, etc. We are planning to throw this site open in October. Over the next four months, we will roll out a programme in a staggered manner wherein dealers in a state can fill in all their information online,” GSTN chairman Navin Kumar said in an interview.

GSTN and the states will use a mix of newspaper advertisements, media campaigns and direct outreach to encourage taxpayers to provide information about their businesses online.

Kumar said GSTN had asked states to obtain PAN from all the traders and that this exercise has been going on for the past two years.

“We have also verified 90% of the PANs from the income-tax department’s database,” he said. “What we have now is the PAN, the name of the business and details of whether it is a company or a proprietorship. But we couldn’t extract any other information from the states as they were all in different formats.”

To be sure, even after it gathers all the necessary information, GSTN can issue the ID number only after Parliament passes three proposed laws: the Central GST, Integrated GST and the State GST.

“If needed, we can generate the TIN for the eight million taxpayers in one day,” said Kumar.

GST is expected to remove barriers across states and integrate the country into a common market. It will subsume most of the indirect taxes levied by the centre and the states, including excise duty, service tax, VAT, entertainment tax and luxury tax. It will put the entire tax process online—right from registration, tax payment and tax return filing to refunds, audits and assessments—thereby making GSTN a very important part of the GST ecosystem.

“It is going to be a long-drawn exercise because of the huge number of assessees. The earlier they start the better. The law will get passed in the winter session. So it does not make sense to wait till then to collect information about the taxpayers else they will not be able to provide automatic registration to the traders in time,” said R. Muralidharan, senior director at Deloitte in India.


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