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.
GSTN also
said that it was working on a scalable model and had enough capacity to deal
with the large volume of invoices. “We had estimated around 3.2 billion
invoices, which was based on the number of invoices in nine states. This is not
scanned invoices. We are handling data and the size of one invoice is 2.6KB and
it will come down further. The number of transactions that we will handle will
be nowhere near that of National Stock Exchange, which is settled in seconds.
The system is scalable. We had estimated 65 lakh taxpayers and the system can
easily handle 1.3 crore,” Kumar said.