From May 1, 2023, businesses in India with an annual turnover of Rs 100 crore or more will be required to follow a new GST regulation. Under this rule, electronic invoices must be uploaded on the Invoice Registration Portal (IRP) within seven days of issuance. The IRP will verify the authenticity of these invoices and assign them a unique Invoice Reference Number for GST purposes.
New GST Regulations 2023
- A new GST rule came into effect from May 1, 2023.
- This rule requires businesses with an annual turnover of Rs 100 crore or more to upload electronic invoices on the Invoice Registration Portal (IRP) within seven days of their issue.
- The new rule replaces the current system in which businesses upload invoices on the day they are issued, regardless of the actual issue date.
- The GST Network (GSTN) has issued an advisory to taxpayers regarding this development.
- Companies subject to this rule must ensure that they upload invoices promptly to comply with the new requirements.
- The restriction will only be applicable to invoices, and there will be no time restrictions imposed on the reporting of debit/credit notes.
- Taxpayers must report invoices within the given time frame as they cannot avail the Input Tax Credit (ITC) if the invoice is not uploaded on the Integrated Reporting Portal (IRP).
- For example, if an invoice has an issue date of April 1, 2023, it must be reported by April 8, 2023, as the system will not allow reporting after the 7-day window.
Current GST Rules
- Electronic invoices are mandatory for B2B (Business to Business) transactions for businesses with a turnover of ₹10 crore and above.
- The turnover threshold for generating B2B e-invoices was progressively lowered from ₹500 crore to ₹20 crore, and as of October 1, 2022, it stands at ₹10 crore.
- Tax officers detected GST evasion worth over ₹1.01 lakh crore in the 2022-23 fiscal year, which is almost double the previous year’s amount.
- During the same period, the Directorate General of GST Intelligence (DGGI) was able to recover ₹21,000 crore.
- To increase compliance and detect fraud, the government is utilizing both data analytics and human intelligence.
- In the fiscal year 2022-23, about 14,000 cases of GST evasion were detected, which is a significant increase from the 12,574 cases detected in 2021-22 and the 12,596 cases detected in 2020-21.
What is GST?
- GST stands for Goods and Services Tax.
- It is a value-added tax levied on most goods and services sold for domestic consumption.
- It is a comprehensive indirect tax that has replaced many indirect taxes in India such as the excise duty, VAT, and service tax.
- The GST is a consumption-based tax levied on the supply of goods and services, and it is collected at every stage of the supply chain.
- The implementation of GST in India was made possible by the 101st Amendment Act of the Constitution, which was passed by the Indian Parliament on August 8, 2016.
- The GST was implemented in India on July 1, 2017, with the aim of creating a unified and simplified tax system for goods and services across the country.
What is GST Council?
- The GST Council is a constitutional body responsible for making recommendations to the Central and State Governments on issues related to Goods and Services Tax (GST).
- It is chaired by the Union Finance Minister and includes the Finance Ministers of all the States and Union Territories with legislatures.
- The GST Council is responsible for deciding the GST rates, exemptions, and thresholds, and also oversees the implementation of GST across the country.
- It was established under Article 279A of the Indian Constitution, which provides for the creation of a Council to make recommendations to the Union and State Governments on various GST-related issues.
What is GSTN?
- The Goods and Services Tax Network (GSTN) is a non-governmental organization that manages the entire IT system for the implementation of GST in India.
- It was incorporated on March 28, 2013, and is headquartered in New Delhi.
- The GSTN is responsible for developing and maintaining the IT infrastructure for GST, including the registration portal, return filing system, and e-way bill system.
- The organization works closely with the Central and State Governments, taxpayers, tax professionals, and other stakeholders to ensure the smooth implementation of GST across the country.
- The GSTN provides various services such as registration, return filing, payment processing, and refund processing to taxpayers.
- It also provides tools and utilities for taxpayers to help them comply with GST regulations, such as GST offline tools, GST Suvidha Providers, and GST APIs.
- The GSTN is governed by a Board of Directors, which includes representatives from the Central and State Governments, as well as industry experts.
- The organization is funded by the Central and State Governments and is managed by a professional management team.
- The GSTN is an important entity for the implementation of GST in India, and its role has been recognized by the Indian Constitution, which provides for the creation of a GST Council and the establishment of a GSTN under Article 279A.
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