GST Network

GSTN

GSTN, which stands for Goods and Service Tax Network, is a non-profit, non-government company. It provides shared IT infrastructure and services to both central and state governments, as well as to taxpayers and other stakeholders. GSTN facilitates registration, returns, and payments for all taxpayers, effectively serving as the interface between the government and taxpayers.

Structure of GSTN

The GST System Project is a unique and complex IT initiative that aims to create a uniform interface for taxpayers and a shared IT infrastructure between the central and state governments. In terms of its structure, private entities hold a 51% share in GSTN, while the remaining 49% is owned by the government. This government share is equally divided between the central and state governments. The authorized capital of GSTN is Rs. 10 crores (approximately US$1.6 million).

Additionally, GSTN has been granted a non-recurring grant of Rs. 315 crores. The extensive technological backend development of GSTN was undertaken by Infosys in September 2015.

GSTN is led by Dr. Ajay Bhushan Pandey, an Indian Administrative Service officer (IAS, 1984 batch), who serves as Chairman, alongside Shri Prakash Kumar, the CEO of GSTN.

Key Features of the GSTN

Here are the key features of the Goods and Service Tax Network (GSTN) to help understand its functions and structure:

National Information Utility

• GSTN is recognized as a trusted National Information Utility (NIU), responsible for providing a reliable, robust, and seamless IT infrastructure and information exchange system.

GSTN Ownership

• GSTN is partially owned by the Central Government (49%) and private players (51%), including banks and financial institutions.

Robust Infrastructure and Complex Operations

• GSTN's primary functions include helping taxpayers register, make tax payments, and claim GST returns. It also generates business analytics and manages the calculation and settlement of Integrated GST (IGST) and Input Tax Credit (ITC). GSTN aims to provide comprehensive solutions for complex taxation processes.

Information Security

• With the Central Government holding the largest share of GSTN, it bears the main responsibility for maintaining the confidentiality and security of taxpayer information. The government manages the board composition, special resolutions, shareholder agreements, and agreements between GSTN and state governments.

Payment 

GSTN offers taxpayers both online and offline payment methods:

• Online: Payments can be made via internet banking. The RBI has authorized certain banks (Agency Banks) to collect GST payments. Taxpayers select an authorized bank, log in to the bank's online portal, make the payment, and download the challan for the payment.
• Offline: GST payments can also be made over the counter at authorized banks. The bank will notify the RBI and update the GST portal with the payment details.

Expenses

User charges for GSTN are equally shared by the Central and State Governments (50:50). The state's share is further divided among individual states based on the number of taxpayers in each state.

Functions of GSTN

The GST Network (GSTN) serves as the front end of the IT ecosystem for taxpayers, facilitating communication between the government and business taxpayers online. GSTN processes over 2 billion invoices and handles returns for more than 6.5 million taxpayers each month. Here are some of the key responsibilities of GSTN:

Registration

• GSTN acts as an online portal connecting taxpayers seeking to register for GST under the new taxation laws with the government. It issues GST Identification Numbers to taxpayers and files the information with the respective tax authorities upon verification.

Invoice Matching

• GSTN matches purchase invoices with sales invoices to identify and correct discrepancies, enabling taxpayers to benefit from Input Tax Credit.

Return Filing

• GSTN processes and forwards returns to both central and state tax authorities. It offers a unified common return filing system for SGST (State GST), CGST (Central GST), and IGST (Integrated GST), eliminating the need for multiple returns.

Taxpayer Profile Analysis

• GSTN verifies the details of taxpayers seeking GST registration and submits this information to central and state government tax authorities for approval.

Latest News - GST System Integrated with Bank Validation

• As of April 24, 2023, GSTN requires bank account validation to be synced with the GST system. This ensures the accuracy of taxpayers' bank details. Taxpayers are advised to check the status of their bank account verification on the official GST portal.

Additional Duties of GSTN

• Calculation and settlement of IGST (Integrated GST)
• Integrating Banking Network (Agency banks) with tax payment details
• Managing Computation Engine of Input Tax Credit
• Submitting the MIS reports to the Government