GST is so complex that state governments are lining up for GSTN services

Goods and Services Tax Network (GSTN), a not-for-profit entity owned by the Centre, states and non-government financial institutions, is building the technology backbone for new Goods and Services Tax (GST) regime. In less than three years that it has been working, the number of states that have asked it to handle their complex back-end processing has grown almost four times, from six to twenty one.

These 21 states now rely on GSTN for back-end tasks such as tax settlement, assessment, refunds, etc.

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"More and more states have realised now that they can just reply on the common application that GSTN is building instead of building their own technology systems," a government official told ET on the condition of anonymity. (S)he added that smaller states like Arunachal, where the number of tax payers is very less as compared to other states, will get major benefits out of GSTN, as they will not have to spend money on appointing an agency to handle operations for a few thousand tax payers.

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Earlier, Uttar Pradesh, Bihar and Odisha had joined GSTN, with Rajasthan, Madhya Pradesh and Punjab saying that they would build their own systems; however, now these states too are in line to subscribe to the GSTN technology.

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Experts said that the reason why these states have shifted from their stands is that they have now understood that using GSTN would save them time and efforts, enabling them to focus their energies on rolling out the new tax regime.

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However, there are some large states, like Karnataka, Tamil Nadu and Maharashtra etc, which already have advanced systems for the existing tax regime, and are thus building their own tech back-end.

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