New Delhi: By decreasing the required turnover level under the Goods and Services Tax (GST) regime from Rs 20 crore to Rs 10 crore, the government has expanded the scope of electronic invoicing for enterprises. October 1 marks the start of the new threshold.
The change aims to digitise a larger number of transactions, increase sales reporting transparency, lessen errors and mismatches, automate data input labour, and boost compliance.
According to sources, the government will also extend it to companies with a Rs 5 crore annual revenue in an effort to stop tax leakage and simplify compliance.
In accordance with the GST Council’s recommendations, the Central Board of Indirect Taxes and Customs (CBIC) notified the rule late on Monday. It modifies the present threshold.
The government intends to make GST e-invoicing mandatory for businesses with a turnover of Rs 10 crore and then Rs 5 crore in the current financial year, according to a July 4 story in “Business Standard.”
E-invoicing (also known as electronic billing) became necessary for businesses with a revenue of at least Rs 500 crore in October 2020. In 2021, this threshold was lowered to Rs. 100 crore for business-to-business (B2B) transactions, and then to Rs. 50 crore.
In order to be eligible for input tax credit, taxpayers must produce invoices using their internal system or billing software and then submit them to the invoice registration site (IRP) (ITC).