Modern Supply network design is targeted at reaching out to where the markets lie. As scales of operations increase, supply chains spread across states. While transaction costs are addressed principally from a logistics point of view, compliance with state taxation laws also add to operating costs. While the value added tax (VAT) legislations have a common structure across states, certain peculiarities are observed for individual states.

Some of these peculiarities are in the areas of handling of credit of capital goods, sale of scrap and second hand goods, formats of mandatory submissions and audit exercises. VAT Compliance Management services by BMR Managed Services seek to address these peculiarities and reduce tax related transaction costs. We understand that the domain of VAT compliance spans across maintenance of records of stock transfers across and within states, all sales and purchases made by registered last mile supply chain entities (be they manufacturers, dealers or traders), input credit reversals, determination of taxable value, maintaining tax credit registers, handling issues pertaining to works contract, entry taxes and Central Sales Tax (CST) and mandatory submissions.

The Service equips the client with the following on a regular and timely basis:

• Automated computation of VAT liability, applying tax position taken by the client in an IT enabled framework
• Automated generation of payment instruments (challans) and returns (monthly, quarterly and annual)
• System driven maintenance of input credit and output tax registers
• Organization-wide management of the various local consultants (tax service providers) that provide services such as filing returns, procuring blank forms from government offices etc. for various regional offices of the organization. Our solution results in a single point of contact for all VAT related service provider relationships. It also holds the promise of a uniform and stricter implementation of Service Level Agreements between the organization and local consultants.
• Procurement and dispatch of CST forms in a timely manner

This service enables BMR Managed services to act as a single point of contact for the tax department of the country specific operations of the client. We manage the multitude of tax facilitators across zonal / regional offices, serves as a knowledge repository for changes in central and state legislations and helps implement the tax position of the client with respect to VAT across operating geographies in the country thereby bringing in uniformity in processes.

Thus the service offers following benefits of right-sourcing through a single service provider of VAT:

• Reduced costs
• Near zero risk of inviting penalties
• Increased visibility of activities on the ground leading to greater senior management control over VAT processes
• Traceability benefits arising out of a process-oriented handling of operations
• Greater enforceability of tax facilitator management strategies and service level agreements
• Working with updated legal information