GST Rules: Goods and Services Tax rules change from August 1 2023

The Ministry of Finance in India has issued a circular announcing changes to the Goods and Services Tax (GST) system. Starting August 1, 2023, businesses with an annual turnover of over Rs 5 crore will be required to generate e-invoice for all B2B transactions. GST Rules: Goods and Services Tax rules change from August 1 2023.

This threshold has gradually decreased from Rs 500 crore in 2020 to Rs 5 crore in 2023, making e-invoicing mandatory for a larger number of companies. Starting on August 1, companies with a B2B transactional value of over Rs 5 crore will be required to produce an electronic or e-invoice.

For all B2B transactions, companies must currently generate an electronic invoice if their annual revenue is Rs. 10 crore or more. E-invoicing was initially (2020) implemented for large companies with turnover of more than Rs 500 crore, and within 3 years the threshold has now been lowered to Rs 5 crore.

E-invoicing for business-to-business (B2B) transactions was made mandatory under GST law for companies with annual revenues over Rs 500 crore starting on October 1, 2020, and then for those with annual revenues over Rs 100 crore starting on January 1, 2021.

Companies that had a turnover of more than Rs 50 crore started producing B2B e-invoices from April 1, 2021. From April 1, 2022, the barrier was reduced to Rs 20 crore. The threshold was further reduced to Rs 10 crore as of October 1, 2022.

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In a related GST news, the Central Board of Indirect Taxes & Customs (CBIC) has rolled out Automated Return Scrutiny Module for GST returns in ACES-GST backend application for Central Tax Officers.

During the recent review of the performance of the CBIC, Union Minister for Finance and Corporate Affairs Nirmala Sitharaman had given directions to roll out an Automated Return Scrutiny Module for GST returns at the earliest.

“In order to implement this non-intrusive means of compliance verification, CBIC has rolled out the Automated Return Scrutiny Module for GST returns in the ACES-GST backend application for Central Tax Officers this week. 

This module will enable the officers to carry out scrutiny of GST returns of Centre Administered Taxpayers selected on the basis of data analytics and risks identified by the System,” said an official release.