Govt Makes GST E-invoicing Mandatory For Companies With Rs 5 Crore Sales

Govt Makes GST E-invoicing Mandatory For Companies With Rs 5 Crore Sales

The GST e-invoicing will likely be mandatory for firms with a turnover of over Rs 5 crore from January 1, 2023, down form the current threshold of Rs 20 crore to further plug leakages, ensure better compliance and policy formulation, Central Board of Indirect Taxes chairman Vivek Johri told FE.

“I think expanding the coverage to over Rs 5 crore will give us very good data for policy making. We can analyse the data at the level of four-digit HS (Harmonised System) and get some sense of which are the sectors which are the sectors which are contributing more to the GST, which have higher potential but are not contributing enough,” Johri told FE.

Initially in Oct 2020, the GST e-invoicing was made compulsory for companies having a turnover of Rs 500 crore or exceeds and later the limit was drawn down to Rs 100 crore and then the current one is for Rs 50 crore that was announced in 2021 for the business-to-business (B2B) transactions.

The tax authorities will also be able to better analyse trends and availment of input tax credit across sectors. They’ll be able to weed out fake ITC claims that have emerged as a major issue. Over 50,000 crore in fake ITC was detected in the past one-and-half years alone.

“Once one can construct all the returns based on e-invoices, the need for invoice matching itself goes away and yet have a foolproof system of return filing. So, that is a very big advantage. E-invoice will (eventually) become universal,” Johri said.

The GSTN has reportedly initiated the process of empanelling several registration portals to provide e-invoicing facility to assist with the higher volumes of transactions. For all businesses currently, there is only one challan registration portal.

“Increasing portals will provide adequate IT infrastructure and an ecosystem to ensure uninterrupted invoice registration services to businesses. It also provides taxpayers an option to choose between the services of different portals. In addition, it helps the GST system to balance the load in case anyone IRP portal faces any challenge due to a long queue,” the business daily quoted another official as saying.

Last week, the GST Council was informed about the process to increase the number of portals and gave approval for it.

The lowering of the threshold for e-invoicing would also significantly expand the number of GST registrants as the number of entities in the bracket of Rs 5 crore to Rs 20 crore would be very high, said MS Mani, Partner, Deloitte India. “This would help in expanding the base of taxpayers, which is one of the stated objectives of GST,” Mani added.

Get ready with solutions for your GST E-invoicing

You don’t need to worry about complex government portals for GST E-invoicing as Munim is here for you. With Munim, you can get your invoices for your business easily within a fraction of a minute without any hassle. Munim’s GST reports will give you regular updates on your GST compliance status so that you can be sure that you are always in Tax compliance with the latest regulations.

If you need any solutions related to GST, invoicing or anything related to accounting then you can contact Munim at any time.

Govt Makes GST E-invoicing Mandatory For Companies With Rs 5 Crore Sales

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