It’s soon going to be a year since the Goods and Services Tax (GST) was launched with much fanfare on the 1st of July 2017. Termed as a transformative tax, it is meant to benefit everyone both on macro as well as micro level. Though GST transformed India into “One Nation- One Tax”; but it also paved way for disruption in technology, supply chain etc.
Changing the Way Business is Done
Post GST implementation, the first few months businesses were grappling with understanding the tax reform. Enterprises had to upgrade their existing IT infrastructure in order to comply with the government’s online filing system. A lot of time, money and effort were taken up in understanding and implementing the new system.
The fluctuating tax rates, increase in filing frequency; clubbed with lack of government updates made the taxation experts work only on understanding the regulations. They lost focus on accounting and taxation compliance.
As businesses witnessed more financial errors associated with the increasing compliance complexity; GST pushed them to move from the traditional way of accounting and tax management. Different tax slabs for commodities & services, made spreadsheets outdated for large organizations with high volume transactions. This was more complex for MNCs with a presence in multiple countries and jurisdictions. Collating the country-wise data and updating it frequently proved to be a Herculean task. Also, reliance on manual processes left too much room for errors in compliance and reporting as per the global norms.
For businesses to stay on top of the ever-changing GST regime, it is important that the tax departments have more efficient processes.
Tax Automation is the Way Forward
With the central government move, pushing for an online GST regime, organizations need a simplified Tax Life Cycle which enables right tax determination, accurate compliance and reporting. Right data points or fields are of utmost importance, as they affect the tax calculation and liability.
A number of GST technology solutions are available that help in automating the process for organizations. There are cloud-based solutions, on-premise solutions and also hybrid solutions that can be availed. On-premise solutions provide a better sense of security as the hardware is controlled by the client. Cloud-based solutions are leaving behind all the other options as they provide a 24×7 support across countries. It also removes duplicity and room for error.
Keeping this in mind, a few leading names have come up with a variety of solutions to simplify the GST compliance and reporting process. EY’s DigiGST, SAP’s Tax Compliance Software, and Thomson Reuter’s ONESOURCETM are a few big names in the league. ONESOURCE India definitely stands out in terms of technology, deployment process and user-friendliness, among its competitors.
It is evident, that automating crucial accounting and taxation processes will give a competitive edge to organizations, especially those operating in multiple states, countries and jurisdictions.
Benefits of Tax Automation
- Process Efficiency
- Global Collaboration
- Improved focus on Tax Strategy and Analysis
- Real-Time Updations
- Improved Analytics
- Multi-ERP Integration
- An Agile Tax Department
- Accurate Data
A good tax engine enables these benefits and helps tax departments focus on other high-value activities like error-free reporting & compliance. It also assists businesses in having key insights and metrics. Most importantly, it enables global collaboration.
It surely is the right time to ride the tide of Tax Automation!