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Rajesh Sharma
AGM-IT
Dainik Bhaskar Group
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GST Overview - history
In the year 2000 Vijpayee Government started discussion, for
introduction of GST, Committee set up under Asim Dasgupta
(Finance Minter of West Bengal), role of committee was design
GST model as well as check IT preparation for same.
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GST Area of impact
Tax Registration Define GST Registration Level
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GST Present Status
GST Bill, which is passed in 2016 Sep.
Question in front of Ruling Government is, are we going to introduce as Money Bill
or Finance Bill, Speaker of house will decide.
To Bring IT set up, 30,000 square feet areas has been set up in Delhi
Digital Platform
Customers
Centre GST
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GSTIN-GST Identification number
Single registration for CGST, SGST and IGST
GST Unique Individual registration to be obtained in each state of
business establishment
Number PAN based registration number Up to 15
characters in length
2 - Digit represents
State
Next 10 - Digit
represents PAN
Number
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GST Rates
The four GST slabs have been set at 5%, 12%, 18% and 28% for different items or
services.
To keep inflation in check, essential items including food, which at present constitute
roughly half of the consumer inflation basket, will be taxed at a zero rate. The lowest
rate of 5 per cent would apply to common use items.
The peak rate of 28% will apply to luxury goods. Luxury cars, tobacco products and
aerated drinks will attract an additional cess on top of the highest tax rate.
The additional cess and a clean energy cess will create a revenue pool which will be
used to compensate states for any loss of revenue during the first five years of the
implementation of GST, Mr Jaitley said.
Service Tax will go up from 15% to 18 %, said Revenue Secretary Hasmukh Adhia.
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Tax registration (GSTIN: GST Identification
Number)
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Customer Master
To identify and manage the various registration numbers (GSTIN) of the customer regions, the
main customer must be extended using a Goods Recipient account group, per region of business.
Each of these will have the region and the corresponding registration number.
Data relevant for GST which is to be captured in customer master are mentioned below.
GSTIN
The registration number to be saved in the Tax number 3(KNA1-STCD3) field of customer master. This field will be
enabled for one time customers as well.
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Customer Master
Data relevant for GST which is to be captured in customer master are mentioned below.
GSTIN
The registration number to be saved in the Tax number 3(KNA1-STCD3) field of customer master. This field will be
enabled for one time customers as well.
Type of customers (Non-registered Govt entities,
Compounding etc.):
The standard tax classification field will be used for
categorizing the customers.
Capital/Raw classification
A new indicator may be introduced based on further clarity by Govt.
HSN/SAC code
For Goods the HSN code will be stored in Control code field of foreign data Tab.
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Material Master
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Material Master
Classification of Services:
The fields Tax indicator for services and/or services group under Basic Data tab may be used.
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Business Place
Multiple business places must be created based on the region/state of operation. The relevant plants must be
assigned to their corresponding business places i.e. region/state wise association. A new field will be provided
to store the GSTIN of the business.
As the GST registration is unique to each state, the plant(s) in the same region must be assigned to state specific
business place.
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Tax Account
Business Place based G/L account determination Both for MM and SD
View: J_1IT030K_V
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Tax Configuration and Computation
Intra-state transactions
CGST and SGST applicable
Inter-state/Import transactions
IGST applicable
Export Transactions
Zero rated (Expected)
Region level rate variations may exist
New condition types/access sequences for pricing and account determination
Tax Procedure
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SD Pricing Procedure
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Document Numbering
Unique sequential numbering may be required for outgoing GST invoices
Criteria for legal numbering may be specified by Govt.
It could be for example
Registration level
Plant level
Document type (Invoice / Credit Memo)
A combination of above
Any other criteria
This can be achieved by using the existing ODN (Official document Numbering) functionality
Assign Document class to Document Types Assign Number Range to Business Place
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Business Transactions - Procurement
Actual Goods supplier will be captured in the Goods Receipt document, which will then be passed on
to invoice verification to identify the actual place of supply and for calculation of taxes accordingly.
To store the Goods suppliers region, we intend to introduce a non-editable field on header details
(Basic data tab) for the relevant IV transactions. This design may change depending on technical
feasibility.
Based on the region of the Goods supplier and the receiving plant, the business transaction will be
classified into intra or interstate and the taxes will be determined.
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Business Transactions - Sales
As per the standard SAP partner determination technique, the sales
order line items will be assigned an appropriate Ship-to party, which
will be used for creating individual delivery documents. These
deliveries/orders can then be used for billing per region.
Line Item 10
Line Item 11
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Pricing
The proposed sample access sequences / condition types/ accounting keys/
tax codes for major business transaction are listed below.
Procurement-Domestic Procurement Intrastate
Access Sequence Tax Procedure
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Domestic Procurement Interstate
Access Sequence Tax Procedure
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Procurement- for capital goods
Access Sequence Tax Procedure
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Procurement Import
Tax setup will be similar to that of Domestic Procurement
Maintain condition record for condition JIIG (inter-state GST) at a zero rate, for such a
combination that it only triggers for import scenario.
To CVD line (IGST in GST scenario), add your non-zero tax code.
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Incoming Invoice
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Incoming Invoice
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Stock Transfer Order
NOTE: Need of an account posting of intra-company STO is still under discussion.
STO via SD
For stock transfer between the various plants (belonging to different GSTIN), a GST
invoice will be created along with the Goods issue document.
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Stock Transfer Order
Stock transfer order
Outbound Delivery
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Outbound GST invoice creation
Billing details screen (Tcode: VF01)
A new billing document type may be provided for these invoices.
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Goods Receipt
Next step will be to capture the GST
invoice. The GST Invoice with an account
payable line.
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Subcontracting/Job Work
Purchase Order components
The existing Subcontracting process remains the same. We may
develop new transactions (similar to J1IF01-Creation of Challan
57F4 and J1IFQ- Reconciliation of Challan) for GST requirements.
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Purchase Order Taxes
Transfer Posting
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Good Receipt
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Services
Existing process of Service Order Creation Service Entry Creation
continues. SAC Code will be fetched from the Service Master and Tax
classification indicator would be used to determine the tax.
Based on the Plant Region and Goods Supplier Region, intra state or
Interstate would be determined.
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Services
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Sales - Domestic (Inter and Intra state)
Access Sequence
Pricing Procedure
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Sales - Exports
It is anticipated that the exports will be zero rated.
Export with GST
More clarity is awaited regarding the ARE-1, Excise bond and Proof of exports.
Export without GST
Taxes to be determined but at zero rate.
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GST Tax Postings
Separate accumulation of credit and payables for
CGST
SGST
IGST
Separate accumulation at Registration level
Automatic Tax posting to respective accounts from business processes
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Utilization of Input tax credit would be as under
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Utilization
New Utilization program to handle GST credit utilization
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Reporting
The reporting for GST is to be made to GSTN (Goods and Services Network) via GSP (GST Suvidha Provider).
The most important forms to be reported to GSTN are:
GSTR-1 (Outward supplies made by the taxpayer)
GSTR-2 (Inward Supplies/Purchases received)
GSTR-8 (Annual return)
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