As organizations rush for year end closure, there is definite challenge in identifying the linkage between Payments Done / GST of the payee / TDS paid. The same is true for the collections done during the year.
A simplistic yet powerful change may create immense value to the ecosystem.
- Debit cards / Credit cards linked to Corporates / MSMEs need to be embedded with GST details. This will solve the offline way of sharing the information with shopkeeper. This information can be shared at switch level with GST authorities to ensure accurate reporting and validation as well.
- All Payment Gateways may be enabled for handling GST details to ensure that even internet banking transactions are handled with right details.
- UPI ids should be linked to GST as well.
- All banking APIs for payments and collections should have provision of passing GST details
- All current accounts to linked GST as this will enable passing of these details, when payments are made.
- NEFT / RTGS / IMPS to carry GST details of the counter party for all corporate payments
What would be needed to enable this?
- Changes in Banking Platforms / Payment Switches
Benefits of this change:
- Companies will not have to struggle with “missing GST claims”, which is quite a challenge.
- Dramatic improvement in accounting for the companies
- Overall simplification of GST compliance at the country level
Why this would work?
- GST comes into picture only when payments are done. When all payments and collections would be linked to GST details of both the parties, this would help in simplifying life of everyone in the ecosystem – companies, government, accounting firms.
Please share your thoughts.