For small businesses in India, complying with the Goods and Services Tax (GST) is essential. GST registration provides a unified tax structure, allowing business owners to work within legal frameworks and avoid complex state-specific taxes. The Government of India mandates that GST registration should be free, with an accessible online portal where businesses can register independently without any charges. However, Common Service Centers (CSCs) have begun offering GST registration through their partner Tax2win as a paid service, with “basic plans” starting at ₹999 — far from free.
This article unpacks the issues with CSC charging fees for GST registration, explains how this practice contradicts government guidelines, and offers insights into how Village Level Entrepreneurs (VLEs) can serve as fair alternatives for clients. Plus, we’ll guide you through how to register for GST yourself on the government portal — absolutely free of cost.
Table of Contents
- How CSC and Tax2win Offer GST Registration — at a Cost
- Why CSC Charging for GST Registration Is Problematic
- A Better Option for VLEs
- How to Register for GST Free on the Government Portal
- Conclusion
How CSC and Tax2win Offer GST Registration — at a Cost
In theory, the Common Service Center (CSC) model was introduced to increase digital service access across India, especially in rural and remote areas. CSCs provide a range of services, from applying for government schemes to banking, education, and now, GST registration. Unfortunately, CSCs have recently partnered with Tax2win to offer a fee-based GST registration service.
Despite the fact that GST registration is free on the government’s own GST portal, CSC’s Tax2win service comes with a “basic plan” priced at ₹846.61, with an added GST of ₹152.39, making the total fee ₹999. Additionally, CSC agents or Village Level Entrepreneurs (VLEs) receive a commission of ₹258 for each registration. As a result, VLEs end up paying ₹741 out of the total, while applicants may not be fully informed about this cost structure and believe that paying is mandatory. This price can further increase if VLEs add their own charges on top.
The result? Business owners are paying for what could have been done at no cost on the government’s official GST portal. This discrepancy between a free government service and a paid CSC offering has raised significant concern, especially since it directly contradicts government intentions to simplify and democratize GST access.
Why CSC Charging for GST Registration Is Problematic
Let’s explore why this fee-based registration through CSC is troubling for business owners and against government policy:
1. Contradicting Government Guidelines on Free GST Registration
According to the Government of India’s guidelines, GST registration should be accessible and free for all qualifying businesses. By introducing a paid model through Tax2win, CSCs are violating the principle of equal access by adding an unnecessary financial barrier. This goes against the core reason GST registration was made free — to support small business growth without financial hindrance.
2. Additional Burden on Small Business Owners
Many businesses signing up for GST are small-scale enterprises. For these businesses, every rupee matters, and paying ₹999 for GST registration is an unwelcome expense. The fee-based structure enforced by CSCs unnecessarily burdens small business owners who, in reality, should not be paying for a free service.
3. High Fees and Hidden Commissions
The CSC model operates with agents, commonly known as Village Level Entrepreneurs (VLEs), who often charge additional commission on top of the Tax2win fees. The total fee includes ₹741 paid by the VLEs, while the rest, ₹258, is a commission they receive from Tax2win. This fee breakdown is not always transparent to applicants, who may assume that paying is their only option. For many who are unfamiliar with the online registration process, CSC appears to be the most convenient, albeit costly, route.
4. Misinforming and Misleading Clients
Not all applicants know they can register for GST independently and free of charge on the official GST portal. The CSC model does little to clarify this, leading some to believe that paying is mandatory. This practice creates an impression that GST registration is a paid service and obscures the fact that registering directly on the government portal is cost-free.
5. CSC and Tax2win Benefit at the Expense of Applicants
As per reports, CSC retains over 80% of the revenue generated from GST registrations via Tax2win. This means that a substantial amount of applicants’ money is going toward third-party profits rather than supporting the applicants themselves. This creates a profit-centric model in an area that the government originally intended to be service-oriented and freely accessible.
A Better Option for VLEs: Offer Transparent, Fair GST Registration Services
Village Level Entrepreneurs (VLEs) are CSC’s designated representatives for delivering services. However, VLEs can make a difference by acting transparently and fairly with clients when it comes to GST registration.
Benefits of Being Transparent with Clients
- Building Trust: Informing clients that GST registration is free on the government portal builds trust and sets VLEs apart from those who charge exorbitant fees without clarification.
- Offering Fair Services: By charging a nominal fee for assistance, rather than the full Tax2win fee, VLEs can offer an affordable and valuable service for clients needing guidance.
Tips for VLEs to Ensure Fair Practice
- Register on Behalf of Clients Using the Government Portal: Rather than using Tax2win, VLEs can register clients directly through the official GST portal, charging a reduced fee for their assistance only.
- Communicate Honestly: Inform clients about the free option and explain that your charge covers your time and expertise.
- Charge Fairly: Instead of ₹999, VLEs can charge a lower fee for guiding clients, making the service accessible while maintaining profitability.
How to Register for GST Free on the Government Portal
If you’d prefer to avoid unnecessary charges altogether, here’s how to complete GST registration yourself for free using the government’s official GST portal:
- Visit the GST Portal: Go to gst.gov.in and navigate to ‘Services’ > ‘Registration’ > ‘New Registration.’
- Enter Your Details: Provide your PAN, email, and mobile number, then verify using the OTP sent.
- Fill Out the Application: Input your business details, including your trade name, state, and business type.
- Upload Documents: You may need to provide proof of address, a passport-sized photo, and bank account details.
- Submit the Application: Once you have filled in all required fields, submit your application for processing.
By following this straightforward process, you can successfully register your business for GST without any third-party charges.
Conclusion: Choose Transparency and Save Money
Using CSC and Tax2win for GST registration adds unnecessary expenses to a process that is free when done through the official portal. As a VLE, you can offer an alternative by providing fair, transparent registration services for your clients. For small business owners, registering independently on the government portal is the most cost-effective option. By choosing the right approach, business owners and VLEs alike can save money, stay compliant, and avoid exploitation by third-party charges.
