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GST Council Meet: GST Network to Become 100% Government Entity

The 27th GST (Goods and Services Tax) Council meet on 4 May 2018 thru video-conferencing  approved making the GST (Goods and Services Tax) Network a government entity by taking over 51% stake that is currently being held by private entities, says Union finance minister Arun Jaitley,   according to the media report. 

The government has already been looking into the possibility of converting GST Network into a majority government company or a 100 percent government company. 

As of now, five financial institutions HDFC, HDFC Bank, ICICI Bank, NSE Strategic investment and LIC housing finance together hold 51% stake in the GST Network. Currently, the Government of India holds 24.5% equity in the GSTN and all States of the Indian Union, including NCT of Delhi and Puducherry, and the Empowered Committee of State Finance Ministers (EC), together hold another 24.5%

The balance 51% equity is with non-Government financial institutions.

 The company has been set up primarily to provide IT infrastructure and services to the Central and State Governments, tax payers and other stakeholders for implementation of the Goods and Services Tax (GST). The Authorised Capital of the company is Rupees ten crore only. 

 The GST Council, the highest decision making body of GST regime, also deferred a decision on levying a cess on sugar and referred the issue of incentivising digital payments to a group of state finance ministers.  

Mr Jaitley further said that the central government will own 50% in the GST Network, while the states will collectively hold the remaining half stake.

The last GST meet (26th GST Council meet) was held on March 10.

The GST collection in April crossed the Rs. 1 lakh crore mark for the first time, indicating stabilisation of the new indirect tax regime that was rolled out on July 1 last year.

It may be recalled BJP MP Subramanina Swamy has expressed concern over GSTN’s shareholding pattern and has asked the Prime Minister to take a ‘close second look’ into that pattern since it allows a private entity to have access to ‘sensitive’ information without security.

 

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