The document gives information on the following topics: 1.What is GST 2.Structure 3.Working of GST 4.Systems to Administer 5.Changes in SAP 6.Challenges 7.SAP Notes & Pre-requisites For freelance services please visit the website: www.salienterp.com or contact on info@salienterp.com

1. GOODS & SERVICE TAX
The New Tax Regime

2. TOPICS
• What is GST
• System of Administration
• Benefits
• GST Structure
• Sample Calculation
• Impact
• Solution Approach & System Changes(SAP)
• Challenges

3. WHAT IS GST ?
• Stands for Goods & Service Tax
• One Unified tax for the whole nation
• Destination based Tax
• Credit available at every stage
• Substitution of all indirect taxes levied by State and
Centre
• Proposed system will take the form of Dual GST ,which is
concurrently charged by Centre as well as State.

4. SYSTEM OF ADMINISTRATION-GSTN NETWORK
• A common and shared IT infrastructure
• A G2B portal (Government to Business)
• All the core functions will take place here
(Registrations,Returns,Challans,Payments)
• System of Truth
• One stop shop for the tax payer
• Tax payers will need upload invoices by 10th of every
month

5. BENEFITS
• Easy Compliance – A single platform to view registrations ,returns
and payments for the tax payers
• Uniformity – A uniform tax structure all through out the supply chain
• Removal of Cascading
• Improved Competition
• Relief in overall tax burden
• Single and transparent tax proportionate to the value of goods &
services
• Better control
• Improved Tax Revenue
• Cross Utilization Allowed

6. STRUCTURE
CGST(Centre) SGST(State)
Central Excise Duty VAT/Sales Tax
Add. Excise Duty Entertainment tax
Service Tax Purchase tax
Add. Customs Duty (CVD) Luxury Tax
Special Additional Duty of
Customs
State Cesses & Surcharges
Surcharges & Cesses Octroi & Entry Tax
IGST=CGST + SGST on all inter-state transactions of supply of taxable
goods & services

7. CALCULATION EXAMPLE

8. CALCULATION EXAMPLE WITHIN THE SATE

9. CALCULATION EXAMPLE :INTERSTATE

10. IMPACT
• Existing Registrations
• Vendors (Vendor’s vendors)
• Customers (Customer’s Customer)
• Logistic Network
• Purchase Scenarios
• Sales Scenarios
• Utilization
• Inter-Company Transfers
• Various Reporting Requirements
• Infrastructure change in order to connect with GSTN Portal

11. SOLUTION APPROACH
• Need to get the registrations
for your plants in various states
• Gather registration data as
well as classification data for
vendors as well as customers
• Gather HSN codes/SAC codes
as well as classification data
for material /services
• List down all existing
purchasing processes and
Sales processes
• List down all the outputs used
in the current processes
• Need to access impact on the
third party applications used in
Procurement, Sales / Logistics
• Gather data about the
applicable GST rates
• Need to check the infrastructure
for connectivity between the
system and GSTN portal
• Assess Reporting requirements,
since the reporting needs to be
done at Item level.

12. PRE-REQUISITES
• SP Level as per SAP Note 1175384
• Default Tax Procedure should be
TAXINN
Other related SAP Notes:
• 2014164 –TAXINJ to TAXINN
• 2039117-Master Note
• 2167294 –Upload Tools
• 2252781 –FAQs on TAXINJ &
TAXINN
• 2194689 – IN:GST
• 2386062 – SAP ASP for GSTN Portal

13. SYSTEM CHANGES
• Master Data Changes
• Vendors –
 GSTN numbers to be captured (15 CHARS)-This
will be done under CIN tab ,in a new field “GSTN
Number". Incase of multiple registrations , the
partner function Goods Supplier (GS) can be
used.
 Vendor Classification- A new field under CIN tab
to classify vendors
• Customers –
 GSTN Numbers- A new field ,same as Vendor
Master
 Customer Classification – Will be done under tax
Classification
 A new partner function called GST Partner to
map multiple locations for customers (Ship to)
Material Master –
 Purchasing View – Tax Indicator to classify the
materials
 Control Code – To map the HSN numbers.
 Sales View- Tax Classification to be used to classify
the materials.
Service Master –
 Tax Tariff Code – Will be used to map the SAC codes.
 Tax Indicator – Classification of Services

14. SYSTEM CHANGES
• Tax Configuration
 New Conditions types to be mapped in the
existing procedure
 New Access Sequences
 Separate Transaction keys
• Account Determination
 Needs to be set for business place
 Separate Ledgers for the different tax
components per business place.

15. SYSTEM CHANGES
• Processes
 Local Purchase - GST needs to be
captured during goods receipts
 Subcontracting – Need to pay GST
while transferring the material to the
Vendor
 Services – Here the SAC codes need
to be reported at line item level.
Hence there will be a change
 Stock Transfers – GST impact needs
to captured during goods receipts in
the receiving plant.There will be
different Billing Type in VF01
 Imports – BCD + IGST
 Tobacco,Alocohol,Petroleum
excluded
 Zero Rating for Exports

16. SYSTEM CHANGES -REPORT
• GSTR1 – Outward supplies
made by tax payer , to be
reported by 10th of every
month
• GSTR2- Inward supplies
received by a tax payer , 15ht
of the month
• GSTR3 – Monthly return,20th of
the month

17. UTILIZATION
• New Transaction to be build for the GST utilization
• The system of truth will be the GSTN Portal ,and not SAP .
Credit of Can be utilized against
CGST CGST&SGST
SGST SGST & CGST
IGST IGST,SGST & CGST

18. SAP’S ROADMAP
Wave 1 : (SAP Notes and System Level Changes)
 30th Nov 2016 –Development will be completed
 9th Dec – Test Wave 1
 16th Dec – Release Wave 1
Wave 2 : ( Changes for GSTN Portal)
 3rd Feb 2017 –Development
 10th Feb 2017 – Test Wave 2
 17th Feb 2017 –Release Wave 2

19. CHALLENGES
• Connectivity between the ERP systems and GSTN Portal
• Understanding the working of GSTN Portal
• Cutover Data Strategy
• Change Management for the User community
• Need information on reverse charge for Service Tax in the GST Regime
• Cesses and Surcharges if any