Infosys’ technology support contract for Goods and Services Tax (GST) is set to conclude in September 2024. In response, GST Network (GSTN) has initiated a search for a consultancy firm. This firm’s primary task will be to create a bid document for the selection of a new technology service provider and to outline a strategic path for elevating the system’s capabilities to what is referred to as GST 2.0. The chosen consultancy must ensure a competitive bidding process and a seamless transition of GSTN’s IT service infrastructure to the new technology provider. This provider will be responsible for furnishing the requisite software and hardware for GST systems over the ensuing seven years, commencing from October 1, 2024.
The scope of responsibilities for the consultancy firm encompasses crafting a request for proposal (RFP) document through an evaluation of the existing system. This assessment will draw upon insights from the past seven years of GST technology. The firm is also tasked with plotting a trajectory for system enhancement and operations during the upcoming contractual term.
India introduced the GST, a pivotal indirect tax reform, on July 1, 2017.
Back in September 2015, prior to the GST’s launch, Infosys had secured a Rs 1,320-crore contract to construct the technological foundation for GST Network. This victory marked a win over competing giants like TCS, Wipro, Tech Mahindra, and Microsoft. The contract entailed establishing a database for the novel tax framework, facilitating enrollment, registration, full automation, and even creating a mechanism for claims and refunds.
Infosys has since played a pivotal role in offering IT infrastructure support for GST-related activities, including business registration, return submissions, tax payments, and tax officer audits.
As the tenure of the present Managed Service Provider (MSP) comes to a close, GSTN is actively pursuing a competitive bidding process to secure a new MSP. This entity will oversee the development, enhancement, and operation of the GST System for the next seven-year period, beginning October 1, 2024.
An outreach to Infosys for comments on this matter yielded no response.
The consulting firm chosen by GSTN will facilitate the competitive bid process for selecting the MSP, in addition to facilitating the transition from the incumbent MSP. The eligibility criteria for the consulting firm necessitates an average annual turnover of Rs 30 crore over the last three years from IT consulting services or IT application development for direct or indirect tax systems or financial systems in India.
Interested parties must submit their bids by September 5.
As a precursor to appointing an MSP, the consulting firm will formulate the detailed RFP, manage the MSP selection procedure on behalf of GSTN, and facilitate the handover of the GST System to the chosen MSP.
The impending MSP’s mandate will extend beyond a mere migration of the current GST System; it will encompass substantial enhancements to system capabilities and the establishment of an efficient monitoring framework.
“The consulting agency will evaluate the recommendations of the technical review committee and identify emerging technical trends to be incorporated into the RFP for the GST System. These requirements can be conceptualized as GST 2.0 in terms of system capabilities,” explains GSTN.
The consulting agency will factor in the existing structure, historical growth patterns, modifications to the GST System beyond its original scope, and the evolving government roadmap—encompassing proposed changes by the GST Council, Law Committee, and others. This assessment will determine the required capacity sizing for operating and improving the GST System over the contractual term.
“While provisioning sufficient capacity to ensure operational readiness for the next seven years and considering various growth parameters, the consulting agency should also include a provision for the potential MSP to phase in infrastructure enhancements throughout the project’s duration,” adds GSTN.
Presently, there are 128 million registered taxpayers under GST. Since its inception in 2017, more than 1.25 billion invoices have been processed through GST systems, and over 670 million returns have been filed.