04.07.2023: More businesses to come under e-invoicing scheme from 1 August

More businesses will be brought under the e-invoicing scheme meant to track business-to-business sales from August and small businesses will be allowed to sell through e-commerce platforms without a Goods and Services Tax (GST) registration from October, said an official.

The e-invoicing scheme that covers all sales other than at the retail level, is a reporting requirement of transactions to designated portals meant to improve compliance.

The data reported at the time of the transaction helps to pre-fill tax returns, brings efficiency and accuracy in reporting and reduces disputes.

Shashank Priya, Member (GST) in the Central Board of Indirect Taxes and Customs (CBIC) said at a conference organized by industry body Ficci that the game-changing step of introducing e-invoicing in 2020 will be further expanded in August.

E-invoicing was introduced on 1 October 2020 for businesses with sales of more than 500 crore.

The threshold was gradually lowered to 10 crore now.

“From 1 August, e-invoicing will become compulsory for businesses with sales up to 5 crore. That is a game changer,” said Shashank Priya.

E-invoicing helps in automating accounting, the data gets auto-populated in GST returns and facilitates trade, explained the official.

“We are not following a Big Bang approach. We continue to incrementally improve it (the GST system). We bring the changes in a calibrated manner,” explained Priya.

A separate scheme of facilitating e-commerce for small businesses will be rolled out from October.

At present, GST registration is compulsory for sales through e-commerce platforms irrespective of the turnover of the supplier, unlike in the case of offline traders, who do not require GST registration for up to 40 lakh.

“We are also looking at making life simpler for some of the smaller taxpayers for supplying through e-commerce operators, with certain safeguards. Now we are proposing to allow, from October, those who are within the threshold of GST registration, to do intra-state supply without compulsorily getting registered,” said Priya, adding that the move is a step in facilitating trade.

“We are hoping to get this started from 1 October, 2023,” he said. Businesses in the composition scheme that file quarterly tax returns are also likely to be included in this scheme. There, however, will be safeguards to make sure the scheme is not abused.

Source: LiveMint

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