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GST Council: GSTN to be made a government body

GST Council: GSTN to be made a government body
GST Council: GSTN to be made a government body

The GST Council, headed by Union Finance Minister Arun Jaitley, on Friday, agreed to convert Goods and Service Tax Network (GSTN) into a 100% government company.

Currently, five private financial institutions — HDFC, HDFC Bank, ICICI Bank, NSE Strategic Investment Co and LIC Housing Finance Ltd — hold 51 per cent stake in GSTN, which was incorporated on March 28, 2013, in the erstwhile UPA regime.

HIGHLIGHTS

  • The GST council has agreed to a proposal of buying out the stake of private entities to make GSTN a government-owned entity

It was widely expected that the GST council would take call over the proposal of converting GSTN into a government company.

The 51 percent equity will be acquired collectively by both Central and state governments following which they will hold 50-50 share in the private limited, not-for-profit company created to provide shared IT infrastructure and services for implementation of Goods and Services Tax (GST).

Finance Minister Arun Jaitley said the collective share of state governments will be pro rata, divided among states in accordance with their GST ratios.

“While doing so the council also recommended that the GSTN will continue to employ people contractually and have the flexibility to get the best talent from the market considering the wide range of activities and the responsibilities of GSTN itself,” Jaitley said.

The GSTN currently is 24.5 percent owned by the central government and a similar percentage is held by state governments collectively.

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