Govt. Wants 100% Control Over GSTN; Private Firms May Be Asked To Quit!

When GST was implemented, Govt. had launched the Goods and Services Tax Network or GSTN, which acted as the IT backbone of the entire taxation system.

Right now, the majority stake of GSTN is held by private financial companies, which soon can change.

As per reports coming in, Govt. wants 100% control over GSTN, and this means that private companies can be asked to quit.

Will private financial firms agree so easily?

GSTN: The Present Structure

GSTN was established as a separate nonprofit organisation, having Rs 10 crore as initial capital.

Right now, Centre and State Governments hold only 24.5% stake each in GSTN, which is described as a separate company.

HDFC, HDFC Bank, ICICI Bank, NSE Strategic Investment Co and LIC Housing Finance hold the remaining stake of 51% in GSTN.

GSTN has every detail of every taxpayer, and the participation of private players in the overall functioning and operations of GSTN was done to induce flexibility, and more responsibility.

Govt. felt that both public and private entities can collaborate via a single portal, and make things easier for the end user.

However, the intentions and the objectives aren’t collaborating it seems.

Govt. has changed its mind.

Govt: Sorry, But We Want 100% Control Over GSTN Now!

In the forthcoming 27th meeting of GST Council, this topic of 100% control over GSTN is expected to be the main agenda.

As per Finance Ministry sources, Govt. is now apprehensive about the privacy and security of sensitive taxpayers’ data, and private companies involved in the core team of GSTN can be asked to quit.

An unnamed Finance Ministry official said,

“At the time of set-up, it was felt that GSTN needed to have the flexibility and freedom of a private company but concerns related to sanctity of data with a private company are being addressed now,”

Ajay Bhushan Pandey, Chairman of Unique Identity Authority of India (UIDAI) is right now the head of GSTN.

The efficiency of GST portal and the way things have been managed by the private companies is also a bone of contention, and several BJP leaders including Subramanian Swamy, a Rajya Sabha MP have repeatedly questioned the process.

Confederation of All India Traders (CAIT), a powerful Traders Body have already described GSTN as a mental torture, as questions about its efficiency to manage 300 crore invoices per month has been raised again and again.

Will the private players involved in the functioning of GSTN simply walk out? Or they will confront and resist Govt.’s takeover bid?

We will keep you posted!