The Hindu Business Line : Post-VAT, software vendors seek downstream biz

WITH the VAT (value-added tax) regime in place, enterprise software vendors, who have ensured a majority of their enterprise clients are VAT-complaint, now see the opportunity for changes downstream, particularly supply-chain management and related applications.

The Director of SSA Global, an enterprise solutions provider, Mr Ravi Kathuria, told Business Line that offering VAT-compliant software is part of the ongoing services a technology provider extends to companies. This can be downloaded and integrated with the existing systems.

With VAT implementation, Mr Kathuria said: "we anticipate changes in the supply-chain-related issues, with the differential between States diminishing. This means enterprises would now have to rework their warehouse strategies and in turn handle supply-chain issues. This presents an opportunity to provide supply-chain related solutions calling for changes."

According to SAP, it has been working towards enabling its customers in complying with their VAT requirements. "This is not a new initiative from SAP as it has been delivering its VAT updates from way back in 2003 when the Government first announced it. SAP has worked closely with industry experts and customers and partners to help educate and prepare them for VAT. SAP is currently working closely with experts in studying various State-level compliance the changes as and when they happen. With Haryana being among the first few States to adopt VAT, Hero Honda Motors was the among the first few SAP customers who was prepared for the change early in 2003," SAP stated.

Says a top official of State Commercial Taxes Department, "the new tax system will change the way people trade. This means they would have to bring in a paradigm shift in supply chain to better manage their business and organise their goods flow."

The Vice-President of Oracle India, Mr Murali Subramanian, recently said that its India Localisation Team at Hyderabad has developed the VAT compliance related localised software as per the new Government regulatory requirements. This can be downloaded to comply with new regulations. This will require certain modifications in the technology systems of both businesses who pay, as well as Governments who collect VAT.

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