New Delhi: GST Network, the company that is readying the technology backbone for the new regime, has dismissed fears that the online tool will be too cumbersome to handle for small businesses, arguing that even under the current regime they are using web-based service for VAT and service tax registration and filing returns.
GSTN chief executive Prakash Kumar told TOI in an interview that even uploading the data will not be difficult since the file will not be too large. “The file size is 5MB, which is equivalent to one minute of WhatsApp video. People say that it will be difficult to file in semi-urban or rural areas. But doesn’t WhatsApp work there? People download plenty of videos. If WhatsApp can work in semi-urban or rural areas, this will also work.”
In any case, the file size will be much smaller for a majority of taxpayers, Kumar said. “Nearly 80% will have a few hundred invoices. A retailer is not making sales to business but to people like you and me. For him supply is probably five lines — what is the gross turnover for five products? For them, the return is very simple.”
State finance ministers such as West Bengal’s Amit Mitra and some of the tax consultants have said the system is not ready, especially for small traders. While the GSTN boss acknowledged that the spreadsheet for recording transactions and the forms may be getting released close to the launch and filing dates, every effort was being made to ensure that tools were thoroughly tested. In fact, based on the feedback from 3,200 businesses from across the country, several changes had been incorporated. He also allayed security concerns, detailing the multi-layer approach and sharing data on a need-to-know basis. Besides, he said the data was encrypted and one person did not have access to full data, including returns.
Asked about concern of small traders, who say that they do not have the technological wherewithal to deal with online registration and other formalities, Kumar said: “Even today VAT registration is online in a majority of states, and for service tax also. In every state, you are filing VAT returns online and you are giving the same details, including the details of the parties involved. In nine states, you are giving invoice-level data. If you are doing it today, what is different tomorrow? Today, 97% of the service tax is paid online and it is similar for VAT. Now, the government is allowing you to pay online as also offline in a bank if it is less than Rs 10,000 in a month,” said Kumar.
While suggesting that some of the concerns may be overstated, he said that in nine states, including Gujarat, Kerala, Karnataka, Tamil Nadu, Uttar Pradesh and Andhra, invoice data has to be filed electronically. “If your counterpart, large and small, is doing it in other states, you can also do. Even today everyone maintains data in the supplier and purchase registers,” he said, adding that invoice details were required for those who were selling to other businesses and not to retail consumers.