GSTN looking for consultancy firm to prepare roadmap for transitioning IT systems to GST 2.0

With Infosys' contract for providing technology support for Goods and Services Tax (GST) ending in September 2024, GST Network (GSTN) has started scouting for a consultancy firm to prepare the bid document for the selection of a new service provider and a roadmap for transitioning the system capacity to the next level -- GST 2.0.

The consultancy firm would have to ensure a competitive bidding process and a seamless transition of the IT service backbone of GSTN to another technology company, which would be providing the software and hardware required in GST systems for the next seven years beginning October 1, 2024.

The scope of work of the consultancy firm would include preparing a request for proposal (RFP) document by evaluating the present system, based on the experience of the GST technology system of the past seven years, and providing a roadmap for enhancement and operations for the next contract period.

Indirect tax reform, GST, was introduced in India on July 1, 2017.

Prior to the GST rollout, in September 2015, Infosys was awarded a Rs 1,320-crore contract for developing the technology backbone for GST Network.

The IT bellwether outbid TCS, Wipro, Tech Mahindra, and Microsoft to bag the contract which involved setting up a database for the new tax regime, enrolment, registration, end-to-end automation, besides providing a system for claiming refunds and credits.

Infosys has been providing necessary IT infrastructure support for GST registration, return filing, tax payment by businesses, as well as audit by tax officers.

"The contracted period of the current Managed Service Provider (MSP), for the development, enhancement, and operations of the GST System, is nearing its completion. Hence, GSTN intends to execute a competitive bid to finalize a MSP for operating the GST System through the next term of 7 years starting 1st October 2024," the GSTN said.

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An email seeking comments from Infosys on the above development did not elicit any response.

The consultant, to be appointed by GST Network would execute the competitive bidding process to select the MSP for GSTN and help in transitioning the operations from the incumbent MSP.

The consultancy firm needs to have an average annual turnover of Rs 30 crore in the last three years from IT consulting services or IT application development for indirect tax or direct tax or a finance system in India.

The deadline for putting in bids is September 5.

As a precursor to the appointment of a MSP, the consultancy firm would design, draft, and create the detailed RFP, execute the bidding and selection process of the MSP for and on behalf of GSTN, and enable the transitioning of the GST System to the selected MSP.

The mandate of the prospective MSP would be to introduce major improvements in the system capabilities and efficient monitoring ecosystem, and not limited to lift-and-shift of the existing GST System.

"The consultancy agency shall review the recommendations given by the technical review committee and determine the newer trends in technical space that can be incorporated in the RFP for GST System. Such requirements could be referred as GST 2.0 in terms of system capabilities," the GSTN said.

The consultancy agency would consider the existing structure, past growth trends, changes made to the system from the original scope for the GST System, and the known government roadmap, like the changes being proposed by GST Council, Law Committee, etc. In the GST framework, determine the capacity sizing required to operate and enhance the GST System for the contract period.

"While sufficient capacity is to be provisioned to operate for the next 7 years considering various growth parameters, the consultancy agency shall also incorporate provision for the prospective MSP to stagger the infra augmentation plan over the duration of the project," GSTN said.

AMRG & Associates Senior Partner Rajat Mohan said other than big 10 consulting organisations, a few mid-size tech companies running ASP/GSP (Application Service Provider/ GST Suvidha Provider) with GSTN are expected to bid as consultants for this project.

Currently, there are 1.28 crore registered taxpayers under GST. Since 2017, over 1,250 crore invoices have been uploaded on GST systems and over 67 crore returns have been filed.

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