The Goods and Services Act has taken away multiple taxes that were previously existing. It had a cascading effect on the manufacturers and consumers. It is in line with the scope of the compelling Government which brings in a slew of new policies and reforms. Like, Make in India, Swacch Bharat, Startup India Action Plan, Demonetization, and much more. This reform has brought out many changes in the administrative and operations set-up of the Government. The net results are that the ease of ranking the Business of India has got appreciation. India has become the highest FDI attracting country in 2015. The Indian Currency is getting stronger. And most importantly, the accountability and transparency in the government are high now and corruption is on the decline. In this article, we will discuss GSTIN.
Concerning these reforms, GST will benefit the Indian Economy and Spur Growth and development. As we have with us a rich demographic dividend, the youngest workforce in the world, and abundant natural capital. It is high time India appropriate the requisite impetus to the manufacturing and production sector. It encourages both domestic and foreign investment to help realize all these resources to the best sustainable potential.
The GST is to roll out from 1st July 2017 and the GSTIN is the most important element of the implementation, governance, and monitoring process behind the GST. It is a unique number allocated to each taxpayer. in fifteen digits it encompasses the identity of the taxpayer. Also, it tells the state he belongs to and the number of entities he/she holds in a state. This number when connected with the GST Portal, would make the implementation of GST convenient and efficient.
GST IDENTIFICATION NUMBER(GSTIN)
The GST Registration Number is given in such a way that these 15 digits contain elements to it with all depicting different values:
Under the GST law, the States are given Codes when a particular taxpayer registers from a particular state. The first two letters of his Code signify the same and can be easily made out. This also implies that you need multiple registrations if you are a multi-state operator. It might just be a little inconvenient but the process for attaining a Registration Number makes it all the simpler. Also for a taxpayer involved in multiple business verticals needs to take a separate registration number for each.
Permanent Account Number (PAN) or the Tax Deduction and Collection Account Number
This is the part where the identity of the Taxpayer integrates with the payment of returns in an inseparable from. It is the part of the tax returns necessary for all the businesses which would prevent concealment of taxes as well. It will be useful to calculate the aggregate turnover to determine whether a business binds to register itself under GST or pay GST. Hence it is a very important element.
This is another ingenious mechanism, this lists the number of entities a person can have in a state, with a cap of 35 entities. This also means that due to the PAN Number the Government now has a precise record that a particular taxpayer has how many entities in how many states in India. All this information and their co-relation is going to facilitate monitoring very much and will ensure that Tax evasion is minimized and most importantly the evaders are punished and that they do not escape the clutches of Law and the Administration.
This is another one of those blank fields. This will be useful for the Government once the actual process begins.
The Registration Number is specifically given in Rule 3(1) of the Registration Rules. There are the provisions for the same and under the new rules, the previous Z-field has been omitted. Moreover, Rule10 of the GST Registration Rules states, it is mandatory, i.e, the word “shall” says, that every registered taxpayer is legally bound to display the certificate of registration in a prominent place at all offices and all branches of offices. The GST Identification Number(GSTIN) is also mandatory for company registration. And that the Entry of such locations should carry a name board with the GSTIN on it. This will go a long way in ensuring corporate governance through transparency and accountability.