Centre fully prepared to ensure smooth transition to new GST rates, GSTN upgrade almost done: Source
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The government is fully prepared to ensure smooth transition to new GST rates with effect from September 22. The backend software infrastructure at the GST Networks (GSTN) have already been aligned with the new rates. It may be noted that the government had been upgrading the IT system, as per the rate recommendations made to the group of ministers and GST Council, much ahead of the September 3 Council meeting, anticipating approvals.
In fact, finance minister Nirmala Sitharaman had held review meetings with the GSTN anticipating the approvals by the GST Council. A source close to the development told Fortune India, “The government has almost completed the backend IT integration exercise.”
“As far as the ERP software provided to the enterprises by the vendors is concerned, that too is being worked upon. And we are confident that they will also complete this well in advance so that the companies can issue invoices with new GST rates seamlessly from September 22,” the source pointed out.
The software system of GST Network (GSTN), provides the IT backend support for return filing and tax payment and has to be upgraded. For the generation of invoices the, corporations will also have to upgrade their ERP systems ahead of September 22.
On September 3, finance minister Nirmala Sitharaman announced a slew of GST reforms including a massive rate reduction, by doing away with the 12% and 28% GST slab.
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“The council announced reduction of GST from 18% or 12% to 5% on a host of common man items such as, hair oil, toilet soap bars, shampoos, toothbrushes, toothpaste, Bicycles, Tableware, kitchenware, other household articles. GST was reduced from 5% to NIL on ultra-high temperature (UHT) milk, prepackaged and labelled chena or paneer; All the Indian Breads will see NIL rates (Chapati or roti, paratha, parotta, etc),” a government release said.
GST was reduced from 12% or 18% to 5% on almost all of the food items such as packaged namkeens, Bhujia, Sauces, Pasta, Instant Noodles, Chocolates, Coffee, Preserved Meat, Cornflakes, Butter, Ghee, etc.