Electronic GST invoicing has created much-needed transparency to fight tax evasion Mohan Ramaswamy


Goods and Services Tax (GST) is a consumption tax used in India on the supply of goods and services. GST was introduced on July 1, 2017 by the Government of India in a majestic ceremony held in the Central Hall of Parliament on June 30, 2017 at midnight.

The Government of India then launched the GST/IRN e-invoice system on a mandatory basis on October 1, 2020. The system expects issuers to flag e-invoices to the government for approval before they are forwarded to the consumer.

Mohan Ramaswamy, Founder and CEO of Rubix Data Sciences, said, “The GST e-Invoice or e-Invoice is a B2B invoice that is authenticated in real-time by the GST Portal (IRP) to enable seamless integration of tax credits on inputs, GST declarations, and E-Way invoicing to facilitate seamless communication between sellers and buyers. As part of this system, the Invoice Registration Portal (IRP) assigns an identification number to each invoice. This invoice is transmitted in real time to the GST portal and to e-way. invoicing portal, eliminating the need for manual data entry when filing GSTR-1 returns as well as generating Part A electronic invoices. The whole process happens in the blink of an eye.

Benefits of Gst e-Invoice for Government and Business

E-invoicing is a chance for advanced change, one of the tenets of the government’s ‘Digital India’ campaign. The new government receipt scheme has various benefits for both the government and citizens and intensifies the simplicity of continuing to work.

This move is supposed to push the huge divided area of ​​MSMEs to embrace the breakthrough innovation, which will thus boost the economy faster. It also makes organizations flexible and versatile to innovation and fresher approaches to pursuing work. These advantages are a sign of the new framework and of real value for the economy.

Ramaswamy said, “Before the government introduced the GST e-Invoice system, it had no evidence of transactions between businesses. Thus, the GST e-Invoice system helps tax authorities to monitor B2B transactions where GST is applicable and secures legitimate Input Tax Claims Credit (ITC) For the government, electronic GST invoicing has created much-needed transparency to combat tax evasion and evasion. »

GST E-invoice is important in helping businesses smooth their receipt processing cycles, reducing the time expected for receipt processing, handling, tracking and tracking of invoices and human error. Applying it ultimately results in much faster turnaround times.

“For businesses, GST e-Invoicing involves digitizing the reporting process, eliminating manual calculations. When properly implemented, this system reduces errors, saves effort, and enables generation, authentication, and real-time invoice tracking GST e-invoicing promotes interoperability between businesses and facilitates supply chain finance,” he adds.

Center plan to make electronic GST invoicing mandatory for turnover of Rs 5 Cr and above

As is known, the Center is now planning to make electronic GST invoicing mandatory for businesses with turnover of Rs 5 crore and above. This would lead to lowering the threshold from the recent Rs 20 crore, a government official said.

E-invoicing recommends a standardized organization of a receipt that can be consulted by a machine. This is a framework where B2B solicitations are electronically verified by the Goods and Services Tax Network (GSTN) for further use on the GST Common Portal.

On this, Ramaswamy said, “Notwithstanding the benefits of e-invoicing, businesses with turnover of Rs 20 crore and above have barely started to adapt to the e-invoicing system. Electronic GST invoicing requires investment in technology and a bit of employee training and awareness. SMEs with a turnover of Rs 5,000,000 may not be technologically advanced and may lack the qualified staff to make this transition seamlessly. Electronic GST invoicing may not be possible for all immediately, and the government may respond with some resistance to this move.”

“Perhaps introducing this in a more staggered fashion – first for turnover above Rs 10 crore and then above Rs 5 crore – may be more realistic. the limit at Rs 5 crore, the time available for entities to implement electronic GST invoicing should be longer to allow for a smooth transition,” he added.

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