SAP India is ready with GST

Goods and Services Tax (GST) is a proposed system of indirect taxation in India merging most of the existing taxes into single system of taxation. The main expectation from this system is to end all indirect taxes and only GST would be charged. GST is a tax that we need to pay on supply of goods & services. Any person, who is providing or supplying goods and services are liable to charge GST. GST is a consumption based tax/levy. It is based on the “Destination principle.” GST is applied on goods and services at the place where final/actual consumption happens.

The GST will cut down the large number of taxes imposed by the Central Government (e.g. Central VAT, Excise duty, Service Tax, Central Sales Tax on inter-state sale, etc) and State (VAT on sales, entertainment tax ,luxury tax, octroi and entry tax charged by municipalities). GST will give credits for all taxes paid earlier in the goods/service chain incentivizing tax paying firms to source inputs from registered dealers only. Since the companies in a chain will have to pay tax on value addition instead of underlying value of goods or service, actual tax paid will likely be small and reduce evasion.

GST is about to become a law in India. SAP India is ready with GST related changes in the software. However there are certain requirements to meet before GST changes can be done in SAP system. GST related changes done by SAP are based on TAXINN concept of tax determination. If you are still using TAXINJ concept of tax determination, you will have to migrate your SAP system from TAXINJ to TAXINN.

The localized SAP GST solutions are design to provide organizations with transformational opportunities by:

Providing common infrastructure and services including document and file management as per Central and State Government guidelines.

Building efficient and convenient tax payers and administrators by leveraging SAP’s global experience.
Facilitating, implementing and setting standards for providing common GST solution for corporate.
Enriching and enabling the SAP ecosystem in India to manage the transition effectively.

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