News

Published: Apr 29, 2023
Updated: Apr 29, 2023

New GST Rules for Businesses with Turnover Over ₹100 Crore Take Effect Today

As of today, new Goods and Services Tax (GST) rules have been implemented for businesses with a turnover of over ₹100 crore. These rules require timely uploading of invoices on the Invoice Registration Portal (IRP) to avail input tax credit (ITC). The aim is to prevent the backdating of e-invoices and promote compliance. This article provides an overview of the new rules, their implications, and the potential impact on GST collection.

New Time Limit for Uploading Invoices:

According to GST Network (GSTN), businesses with a turnover of ₹100 crore or more must upload electronic invoices on the IRP within 7 days from the date of issuance. This time limit replaces the previous practice of uploading invoices on the current date, regardless of the invoice's issue date. The new rules ensure timely reporting and compliance with GST regulations.

Restriction on Reporting Old Invoices:

The GSTN advisory clarifies that taxpayers falling into the above-mentioned turnover category will not be allowed to report invoices older than 7 days. This means that if an invoice was issued on April 1, 2023, it cannot be reported after April 8, 2023. The invoice registration portal's validation system will disallow reporting beyond the 7-day window, emphasizing the need for timely compliance.

Impact on Input Tax Credit (ITC):

Under GST law, businesses can only avail input tax credit if their invoices are uploaded on the IRP. Failing to comply with the new rules may result in the denial of ITC benefits. This change aims to streamline the reporting process and prevent any misuse of the system.

Positive Implications and Future Prospects:

Experts believe that these technological changes will curb the backdating of e-invoices by large companies. With successful implementation for major taxpayers, it is anticipated that similar changes will be introduced for all taxpayers gradually. This move is another step towards digitalization and increased compliance in the GST framework.

Potential Boost to GST Collection:

By enforcing strict timelines for reporting invoices on the IRP, the government aims to enhance compliance and ultimately increase GST collection. As the turnover threshold for mandatory e-invoicing decreases, more taxpayers will generate Invoice Registration Numbers (IRN), leading to a more comprehensive tax collection mechanism.

Government's focus on curbing evasion:

The article also highlights the government's efforts to detect and prevent GST evasion. Tax officers have reported a significant increase in evasion cases, with detection amounting to over ₹1.01 lakh crore in the 2022-23 fiscal year. The government plans to utilize data analytics and human intelligence to identify fraud and strengthen compliance measures.

Move to enhance transparency:

The introduction of new GST rules for businesses with a turnover of over ₹100 crore brings about important changes in the reporting and compliance framework. The timely uploading of invoices on the Invoice Registration Portal is crucial for availing input tax credit. This move not only aims to enhance transparency but also contributes to the government's goal of curbing tax evasion. Businesses must adapt to these new rules to ensure compliance and avoid any adverse impacts on their GST processes.