"GST would enhance dependency on technology and eventually bring more transparency"

Ankit Agarwal, Managing Director - Alankit Limited in a chat with VARINDIA how the current GST tax structure will counter various issues in the previous taxation system and how Alankit will contribute to it through its own solutions and generating awareness among its customers -

What are your views on how the newly introduced GST is going to revolutionize the taxation system in the country?

GST came as the biggest reform in the area of Indirect Tax in the history of independent India. Consolidating the numerous Central and State Taxes into one Single Tax, it has truly delivered on its objective of levelling the playing field for all businesses and ensuring “One Nation, One Tax.” But like any other change, teething troubles are bound to surface in implementation phase. Especially the smaller businesses across sectors of the economy are being impacted temporarily as they embrace and adapt to digitization which is essentially for GST compliance.

For a SME, the biggest dilemma is whether to focus on the business or to understand the modalities of the GST. Moving beyond the much engraved traditional way of functioning to the automated systems require them to invest time, money and effort. However, it is important for them to focus on the larger vision and long term benefit.

Harmonizing the current tax structure, GST has countered various issues such as multiplicity of taxes at Central and State level, lack of uniformity, tax on tax, and tax cascading. Businesses have been impacted positively as by having a common national market, disputes between manufacturing and processes have been eliminated. Processes are more streamlined, and various cumbersome tasks are shortened and improvised. The penetration of automation and minimization of human interface has also led to a reduction in tax evasion, bringing in greater transparency. In short, the indirect tax reform is a pat on the back of the nation, which will reap benefits over the course of years to come. There still a gap persists before India becomes completely GST ready.

How is Alankit trying to close that gap through its offerings and generating awareness among the small businesses?

GST has revolutionized the way businesses function in India but its implementation is bound to be faced with some temporary logistical and infrastructural roadblocks. While most large corporates have the knowledge and ability to evaluate multiple solutions being offered in the market to adapt the best suited technology for effective compliance, there are many small players facing multiple challenges not only in understanding nuances of GST regime but are also clueless on how to go about choosing the right partner who may handle hold them through the process for seamless transition.

GST service providers should realize that different businesses have different requirements, and should thus precisely work on developing customized solutions which are best suited to a specific player’s needs. Alankit realizes that offering the following services serves a worthy purpose of assisting businesses in complying with GST through the requisite features it offers as part of its cloud based solution which will reduce the cost of compliance for SMBs.

GST Muneemji also allows the customers to use their existing account system or change the account system as per their requirements. It allows the users to download any file format and upload it on GST Muneemji and comply accordingly. We are also having an all India GST evangelization drive across 22 cities to spread awareness and get businesses on-board with GST. Many small businesses lack the technology and familiarity to incorporate GST into their operations. For such businesses, we offer PoS Terminal solutions which include a tablet, a debit/credit card swiping machine, a small printer, and a finger print scanner for Aadhar enabled payments.

Have you partnered with any vendors and partners for conducting the 22 cities evangelization drive? What is the objective behind it and what is the target set in terms of the number of businesses that you are looking at addressing?

Alankit has a network of over 5,000 centers in 673 cities across India. Through this wide network, we are organizing evangelization drives in metros and tier II towns (Delhi, Mumbai, Bangalore, Chennai, Hyderabad, Cochin, Ahmedabad, Indore, Guwahati, Raipur, Vishakhapatnam, Lucknow and Chandigarh). We have an established network with chartered accountants, lawyers, Tax compliance professionals, software developers, SAP ERP solution providers and technology partners that is supporting us in capitalizing on creating awareness and affinity towards the change across business circles.

Each seminar saw an audience of over 300 professionals and businesses across various circles of the GST ecosystem. Targeting over 6,600 people across the country, we have already accomplished over 2,000 registrations and migrations. The rationale behind these seminars is to spread awareness and get businesses on-board with GST for increased compliance.

What kind of operational challenges do you still face in the IT infrastructure created for GST implementation?

GST as we know has changed business processes drastically. Adoption of technology and moving away of businesses from a complex indirect tax structure, to the new revolutionized tax regime has been a paradigm shift for all Indian corporations. While the new regime promises and offers long term benefits, it does come with certain immediate and short term infrastructural and implementation challenges.

As the new regime get implemented, tax experts foresee certain challenges such as tracking interstate transactions, designing and developing a suitable IT infrastructure, and all of this needed to be created on a fairly large scale. But these are temporary concerns and are being tackled well by experts from a technology and taxation domain. Some immediate challenges include increase in volume of return filing. With moves like demonetization, direct tax filing by individuals has gone up by 25% to 2.82crore, GST is expected to have a similar impact on indirect taxation and such a change would enhance dependency on technology. Therefore, with increased burden on technology, need for real time scalability of solutions interacting with the GST network also become another challenge. Yet, all these challenges would be resolved as implementation begin full throttle in coming months.

What is the future you foresee for GST in the country?

GST has been positively implemented in around 140 countries including Brazil and Canada. In fact, France was the first country to introduce GST. Tried and tested in other countries, GST will play a significant role in transforming the current tax structure, and therefore the economy.

So far, the impact of the revised tax structure has been positive across most sectors. Efficient tax collection, reduction in corruption and easy inter-state movement of goods are few positive signs which prove that GST is to help India grow.

Ever since the opening of GSKs, what is the average number of queries do you receive in a day and how many are you able to address? What kind of queries does it generally involve?

We get around 20 queries daily from different corners of the country. Most of these queries are related to migrations and registrations. It is through our range of tax experts that we successfully offer solutions to 100% of the queries we get.

How will the launch of PoS terminal help SMBs get onboard with GST?

Since the process of accounting has now become digital, many SMBs face the challenge of not having the required technology and the related knowledge. Our Point of Sale (POS) Terminal solutions are targeted towards these small businessmen to help them adopt this technology and comply with the new regime.

The POS device incorporates a tablet, a debit/ credit card swiping option and a small printer along with a fingerprint scanner for Aadhaar enabled payments. This POS device when connected to internet would transfer all transactions data onto the ASP platform. It will thus help these businesses in easy record keeping and further processing of invoices as per GST guidelines. Even when the devise is offline it would record transactions for easy transmission later. This solution will help all the small and unorganized businesses comply with the GST regime.

Tags: gst, ankit agarwal, ankit agarwal alankit, varindia, gst, GST tax structure, One Nation, One Tax, GST Muneemji