New E-Invoicing Rule To Bring 180K More Companies Into GST Fold

Know the New E-Invoicing Rule

Under the new e-invoicing rule, the latest GST update on 1st April 2022 added 18,000 GSTINs (GST Identification Numbers). It rose from 240,000 to about 420,000.

Compulsory e-invoicing of B2B (Business to Business) transactions for companies with a yearly turnover above ₹20 crores will increase GST registrations by 75%, a government official said speaking on the e-invoicing rule.

Key Changes To Look For in E-Invoicing and GST Updates

E-invoicing provides a real-time track of invoices generated by suppliers and lowers the scope of the fraud.

• A firm can have one or more GSTIN, if the business is running in two or more Union territories, or states. Otherwise, registration is needed if the firm has multiple branches in one state. 
• With e-invoicing compulsions, the rate of fraud in small and medium-scale enterprises will stop now. 
• E-invoicing covers submissions of already made standard invoices on a general e-invoicing portal. 
• Firms like- financial institutions, insurance banks, NGOs, passenger and goods transportation services, and firms under SEZs (Special Economic Zones) are exempt from issuing e-invoices.

Before, 53,523 firms came under the GSTIN rule in October 2020. Later, 91583 more GSTINs were added by January 2021 and in April 2021 it went to 95461 more entries. The total number of GSTINs was 240,567 by the end of 2021. This number is forecasted to increase even more by the end of 2022. As before companies with ₹50 crore turnovers were only issuing e-invoicing. But now that the scale is reduced to ₹20 crore turnover will add more small and medium scale industries in the rule too.  

The founder of a fintech company stated, “E-invoicing is the latest online leapfrog for Indian companies that have conducted online payments so well. It will also assist them to use digital transactions and will be a lead driver for their business growth.”

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