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GSTN glitches: Modi won the demonetisation perception war; he would win the GST deflection war as well

India runs three online systems on a scale unrivalled heretofore.  Its IRCTC portal is robust enough to take on a crushing burden including the peak and festival eve bookings but for occasional glitches. Some 15 lakh tickets are booked online through IRCTC portal every day on an average.  Its Aadhaar portal run by UIDAI also responds fairly well to online verification queries from authorities and online changes in Aadhaar details even though during the course of a busy day, there is sometimes delay in getting OTP from UIDAI by those seeking to make changes online.  For those who are statistically inclined, more than 1.12 billion Indians -- 88.2 percent of the population -- have now been enrolled for Aadhaar, the controversial biometric national identity programme as of March 2017.

But GST is a different ball game because in a month there could be 300 crore invoices uploaded into its portal GSTN by as many as 1 crore traders and service providers which explains the slowing down of the system during the course of a busy day.  “The glitches reported in the GST Network over the last two months could be temporary difficulties in the beginning”, says Ajay Bhushan Pandey, CEO of UIDAI.  Yet, one is skeptical if anyone in the government can afford to make light of admittedly a potentially explosive issue.  Indeed, there is a sneaking suspicion that we put the cart before the horse insofar as GST rollout is concerned.  It was rolled out on 1 July, 2017 thus heralding the beginning of the world’s busiest portal buzzing with activity non-stop.



The Constitution amendment (with two-thirds state government support) that paved the way for GST gave the government time upto 15 September to put in place GST in lieu of plethora of indirect taxes and duties.  In other words, GST is not essentially BJP or the central government’s baby; the opposition and state governments are also then guilty, if at all, of boxing the nation into a tight corner.  For, it has been conceived, delivered and nurtured by the state governments as well.  Nobody therefore can accuse the Modi government of being in a tearing hurry to rollout GST whimsically alone---states have had a vital and decisive role in its rollout and implementation.

Indeed, the Modi government would disarm the critics by going to town with the glib explanation that GST was and is a true national endeavor cutting across party lines. The GST Council, the lynchpin of the entire GST regime, has the Union Finance Minister (as Chairman),

• The Union Minister of State in charge of Revenue or Finance, and

• The Minister in charge of Finance or Taxation or any other Minister, nominated by each state government.

The decisions of the GST Council are made by three-fourth majority of the votes cast. The Centre has one-third of the votes cast, and the states together have two-third of the votes cast. Each state has one vote, irrespective of its size or population.  The short point is if the push comes to shove, the Modi government would easily deflect the charge of haste or inefficiency onto the opposition as well by saying GST is nation’s baby.

The Modi government won the perception war on demonetisation.  Now, it is going to win the deflection war, as it were, on GST.  Indeed, it has put in place in the GST architecture the Teflon mechanism that would make any charge against it unstuck.

Yet, it cannot take perverse comfort from this alone because while demonetisation was a onetime exercise with mid-term impact, GST is a never-ending project.  The IT and internet backbone must be robust to ensure its smooth functioning.  Small scale units especially lack both IT and internet infrastructure with the latter being beyond their control if they are located away from internet sweet spots.  Government must give all encouragement to make the entire nation networked with unfailing and speedy internet connectivity that can take on voluminous data.

Updated Date: Sep 12, 2017 15:09 PM

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