Indian retailers rise to IT integration challenges of GST

On July 1st, India ushered in the “GST era” with a special session of Parliament to launch the Goods and Sales Tax. While the business community has generally  been optimistic about the future under GST, there was some trepidation because, even at that late stage  it seemed to be a work in progress rather than a well settled system with all processes ironed out.

On the whole,  the first stage of the roll-out has been quite uneventful. Vendors have started raising invoices with GST tax components. In the case of Openbravo. we have released the initial version of the localization in time for this deadline, and our clients have quietly moved over to GST with it’s new tax structure, though there was considerable last-minute configurations as rates got finalized and some appeals for tax-rate changes were approved.

The next stage in the process is probably the most challenging. Filing retuns under GST is more system-oriented than before, even for states where e-filing was the norm for VAT. Sales data has to be uploaded, purchase data has to be verified and tax credits are automatically identified based on vendor and customer returns. There are also mechanisms to resolve difference in invoice details between the two parties. The monthly return process then closes with the calculation and payment of the remaining tax payable amount and the submission of the final return for the month (GSTR3)

The government, realizing the complexities involved here and the concerns of the business, has provided additional time for the filing of returns for the first two months. They have also provided different options for filing the returns:

1. Through the online portal – where the user logs on to the GST portal and then manually enters the details;
2. Using an offline tool – where the user generates the data for the retuns as per a template and then the information is secured and uploaded through an offline upload tool that is provided by the government;
3. By integrating the ERP system with the GSTN systems though pre-selected third party intermediary viz. the GSP.

We at Openbravo have been working with the GSTN-provided APIs to provide seamless integration from the invoices generated in the system to the GSTN network. However, these APIs are still being defined and are expected to get finalized for the monthly returns over the next couple of months. This option also requires clients to choose a GSP through which the data is transferred to the GSTN systems and these intermediaries charge a nominal fee for providing the secured integration service.

Openbravo is also planning to provide an alternate option for integration viz providing extracts that would provide data in formats comaptible with the offline tool, so that our clients can easily load their sales returns through the tool. This option, which would be attractive for smaller implementations, has the additional advantage of not incurring integration charges from the GSPs. We believe that this would also serve as a back-up option for even the larger customers, at least until the systems stabilize. With these considerations in mind, we are planning a release that supports the offline tool in the middle of August .

The currently released GST version can be accessed from the forge (for both the business suite and the commerce suite) and videos about the functionality that is provided can also be viewed on YouTube

Want to know more? Join me in our next webinar, Seize the opportunity as GST launches in India,  on June 25, 2017 at 4:00pm IST. Register here