GST SUVIDHA PROVIDERS (GSP): ILLUSTRATED FRAMEWORK
(BUILDING OF GSP ECO SYSTEM)
The Goods and Services Tax constitutional amendment having been promulgated by the Govt of India, the rollout of the GST Bill will be a collective effort of the Central and State Governments, the tax payers and the IT platform provider i.e. GSTN, CBEC and State Tax Departments. Besides these main participants there are going to be other stakeholders e.g. Central and States tax authorities, RBI, the Banks, the tax professionals (tax return preparers, Chartered Accountants, Tax Advocates, STPs etc.), financial services providing companies like ERP companies and Tax Accounting Software Providers etc.
The GST System is going to have a G2B portal for taxpayers to access the GST Systems, however, that would not be the only way for interacting with the GST system as the taxpayer via his choice of third party applications, which will provide all user interfaces and convenience via desktop, mobile, other interfaces, will be able to interact with the GST system. The third party applications will connect with GST system via secure GST System APIs. All such applications are expected to be developed by third party service providers who have been given a generic name, GST Suvidha Provider or GSP. The GSPs are envisaged to provide innovative and convenient methods to taxpayers and other stakeholders in interacting with the GST Systems from registration of entity to uploading of invoice details to filing of returns. Thus there will be two sets of interactions, one between the App user and the GSP and the second between the GSP and the GST System. It is envisaged that App provider and GSP could be the same entity. Another version could where data in required format directly goes to GSP-GST Server. The diagram below gives the most generic case.
In the evolving environment of the new GST regime it is envisioned that the GST Suvidha Providers (GSP) concept is going to play a very important and strategic role. It is the endeavour of GSTN to build the GSP eco system, ensure its success by putting in place an open, transparent and participative framework for capable and motivated enterprises and entrepreneurs.
GST Compliance Requirement by the Taxpayer
The taxpayer under GST Regime will have to provide following information at regular intervals:
- Invoice data upload (B2B and large value B2C)
- Upload GSTR-1 (return containing supply data) which will be created based on invoice data and some other data provided by the taxpayer.
- Download data on inward supplies (receipts or purchase) in the form of Draft GSTR-2 from GST Portal created by the Portal based on GSTR-1 filed by corresponding suppliers.
- Do matching of purchases made and that downloaded from GST portal. Finalize the same based on his own purchase (inward supply data) and upload GSTR-2
- File GSTR-3 created by GST Portal based on GSTR-1 and 2 and other info and tax paid.
- Similarly there are other returns for other categories of taxpayers like casual taxpayer or composition taxpayers.
It is expected that the GSPs shall provide the tax payers with all services mentioned above in addition to maintaining their individual business ledgers (sales ledger and purchase ledger) and other value added services around the same. Another important service expected from GSPs is the automatic reconciliation of purchase made and entered in the purchase register and data downloaded in the form of GSTR-2 from the GST portal. In additional there will be sector-specific or trade specific needs which the GSPs are expected to fulfil. The conceptual diagram depicting the same is as given below.
While the GST System will have a G2B portal for taxpayers to access the GST System there will be a wide variety of tax payers (SME, Large Enterprise, Small retail vendor etc.) who will require different kind of facilities like converting their purchase/sales register data in GST compliant format, integration of their Accounting Packages/ERP with GST System. Similarly, the specific needs of an industry or trade could be met by GSP. In short, the GSP can help the taxpayers in GST compliance through their innovative solutions.
Design & Implementation Framework
Tax payer’s convenience will be a key in success of GST regime. The tax payer should have a choice to use third party applications which can provide varied interfaces on desktops, laptops and mobiles and can connect with GST System. The GSP developed apps will connect with the GST system via secure GST system APIs. Majority of GST system functionalities related to taxpayer’s GST compliance requirements shall be available to the GSP through APIs. GSPs may use GST APIs and enrich and enhance the tax payer’s experience. (The APIs of GST System are RESTful, json-based and stateless). GST System will not be available over the Internet for security reasons.
The production API end points can only be consumed via MPLS lines. All APIs will be accessed over HTTPS protocol. The benefits of API based integration are:
- Consumption across technologies and platforms (mobile, tablets, desktops, etc.) based on the individual requirements
- Automated upload and download of data
- Ability to adapt to changing taxation and other business rules and end user usage models.
- Integration with customer software (ERP, Accounting systems) that tax payers and others are already using for their day to day activities
The detail implementation framework can be perused on this website at http://www.gstn.org/ecosystem/pdf/GSP_Implementation_Framework.pdf
Selection and On-boarding of GSPs
Any prospective applicant for GSP will need to meet a pre-qualification criteria for GSPs. The pre-qualification criteria are detailed later in this document.
GSPs who meet the pre-qualification criteria will sign a contract with GSTN to become an authorised GSP.
On signing of the contract, GSPs will get a unique license key for accessing the GST system. GSPs will be authenticated using this license key (Client id + Client Secret) provided by GSTN. GSP will have a provision to generate multiple License keys as per its need.
Who Can Become a GSP?
The organisations and entities who are expected to sign up as GSPs are visualised to be as under:
- Registered companies in India in the IT / ITES / BFSI domain.
More details on pre-qualification are given at http://www.gstn.org/ecosystem/pdf/Eligibility_Criteria_for_GSPs.pdf
How to Become a GSP ?
GSPs will need to sign up a contract with GSTN. The draft of this contract is uploaded athttp://www.gstn.org/ecosystem/pdf/Agreement_GSP_legal_standard_draft.pdf
This draft contract has the following content:
- Definitions, responsibilities of GSPs and their legal obligations as well as liabilities
- Technical architectural framework as to how GSPs shall integrate with GST System
- Commercial terms and conditions along with SLAs to be met
- Pre – qualification criteria for GSPs.
Interested organisations may register at http://www.gstn.org/ecosystem/gsp_form by 15th Oct 2016 by providing details in the registration form. GSTN will first consider those organisation which fulfil pre-qualifications. After stabilization of the first batch of GSPs, more applicants(organisations) will be considered for GSP, out of those applicants who register themselves now.
Registration is free.
Source : Goods and Service Tax Network website GSTN.org
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