The introduction of Goods and Services Tax (GST) is one of the biggest tax reforms undertaken in India, providing a uniform and simplified way of indirect taxation. GST is not just a change in the tax structure or regime but it will also benefit the economy as a whole and have far-reaching impact on businesses. This “One nation, One tax” thinking could prove to be a game changer in a positive way and be beneficial not only to the common man but to the country as a whole.
The GST Act is expected to impact all banks and financial institutions across multiple dimensions. Banks will need to identify services which are linked to an account or otherwise, as this will determine the place of supply. Under the GST regime, this centralized aspect of recognizing revenues, procurements and credits would need to be revisited.
Banks will need help in tracking all processes, expenditure and savings in a single view, irrespective of the point of origin or service. Similarly, banks will be challenged to bifurcate activities that are currently exempt from service tax from the once that will be charged under GST. Banks will need to relook at the operations, customer profiles, product mix, and the IT system’s ability to capture the requisite details about the service recipient. And ultimately, the IT systems would need to be robust enough to serve the intended purpose of adhering to compliances and achieve credit efficiency, by timely and appropriate payment of taxes.
Enabling banks to be GST-ready
SunTec is committed to helping Indian financial institutions transform themselves. Just as the Indian market is firmly moving towards GST, SunTec has moved ahead of the times with our offering ‘Xelerate for GST’.
“Xelerate for GST” is an out-of-the-box solution targeted to enable banks with a smooth transition with the various drafts of the GST Act and provide uninterrupted service to their customers.
SunTec’s Center of Excellence for GST coupled with Agile mode of delivery ensures faster time to market. Xelerate’s end-to-end solution, a robust future-ready roadmap and seamless integration capability with any IT environment ensures flexibility and future-readiness of the GST system