In a big relief to small companies, the Central Board of Indirect Taxes and Customs (CBIC) has raised the threshold limit to mandatorily file e-invoice to Rs 500 crore from earlier Rs 100 crore turnover for businesses.
A government notification said those operating in the Special Economic Zones (SEZ) don't need to follow e-invoicing norms and that e-invoicing facility for B2B transactions will be implemented from October 1.
CBIC Principal Commissioner (GST) Yogendra Garg, during an Assocham event recently, said: "Yesterday, the GST Implementation Committee has recommended that we will go ahead with October 1 deadline (for e-invoice)... To begin with, we will not do it for Rs 100 crore and above, as we had notified. We will soon come out with a notification to make it Rs 500 crore from October 1 and as they stabilise, we will bring a date for Rs 100 crore turnover people."
In November last year, the government had said that from April 1 electronic invoice (e-invoice) would be mandatory for businesses with a turnover of Rs 100 crore. Later in March 2020, the GST Council extended the implementation date to October 1.
The purpose of implementing e-invoices is to curb the GST evasion through the issue of fake invoices. It would make the returns filing process simpler for businesses as invoice data would already be captured by a centralised portal.
This will also eliminate the need for data entry of purchase invoice by the buyer as that will be shared electronically and read by the accounting/billing system of the buyer even before the goods arrive.
Reporting of e-invoice to GST portal, generated using prescribed standard, will lead to pre-filled sales and purchase returns. However, experts say its limited launch means that while large companies will have to implement it, their vendors who could be smaller companies with turnover less than Rs 500 crore may not implement it in the first phase, and hence the desired result of pre-filled sales and purchase returns may not be achieved.