AMN / NEW DELHI
The Union Cabinet has cleared a proposal to convert Goods and Services Tax Network (GSTN) into a government-owned company.
It approved increasing the Government ownership in Goods and Services Tax Network (GSTN) and change in the existing structure with transitional plan.
There will be the acquisition of entire 51 per cent equity held by the Non-Government Institutions in GSTN equally by the Centre and the State Governments and allow GSTN Board to initiate the process for acquisition of equity held by the private companies.
Currently, the Centre and states together hold 49 per cent stake in the GST Network, the company that provides IT backbone to the new indirect tax regime.
The remaining 51 per cent is held by five private financial institutions.
The restructured GSTN, with 100 per cent government ownership shall have equity structure between the Centre 50 per cent and the States 50 per cent.
Briefing reporters after the Cabinet meeting, the Finance Minister Arun Jaitley said, 50 per cent stake will be owned by the Centre and the remaining by the states on pro-rata basis in the new structure.
To allow change in the existing composition of the Board of GSTN, the government inducted three directors from the Centre and the States and three other independent directors will be nominated by the Board of Directors. Besides, there are one Chairman and the CEO. Thus, the total number of Directors is 11.