Government To Make E-Invoices Mandatory For B2C Transactions In 2-3 Years

The official stated that businesses with turnover between Rs 5-10 crore are not completely issuing e-invoices and CBIC officers have been prompting businesses who have been non-compliant.

The official added that the GST systems need to be improved and efforts are being made to include Business-to-Consumer (B2C) transactions under e-invoicing.

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The Indian government could make it compulsory for businesses to provide electronic or e-invoices for B2C transactions in the next two to three years, an official said on Wednesday. Businesses with a turnover of Rs 5 crore and above are needed to give e-invoices for their Business-to-Business (B2B) sales and purchases. 

Central Board of Indirect Taxes & Customs (CBIC) member-GST Shashank Priya noted that now the government intends to make the e-invoice mandatory for B2C transactions as well. The official added that the GST systems need to be improved and efforts are being made to include Business-to-Consumer (B2C) transactions under e-invoicing, reported PTI.  

Speaking at the Associated Chambers of Commerce and Industry of India (ASSOCHAM) event, Priya said, “We are looking at requirement of e-invoice for B2C. GSTN capacities need to be upscaled. Systems will have to be put in place. We have to see which are the sectors we can start first. It is work in progress but we hope in years to come we will be able to take this forward”.

The official stated that businesses with turnover between Rs 5-10 crore are not completely issuing e-invoices and CBIC officers have been prompting businesses who have been non-compliant. Addressing the National Conference on GST, Priya noted, “Its (business with Rs 5 crore turnover issuing e-invoice) implementation is still quite tardy. We have issued instructions. We are trying to nudge taxpayers that it has certain advantages like ease of doing business. GSTR -1, e-way bills will get populated.”

The government has been gradually making e-invoices compulsory for businesses. As per the Goods and Services Tax (GST) law, e-invoicing for B2B transactions was made compulsory for firms with a turnover of more than Rs 500 crore from October 1, 2020. This was later extended to those with a turnover of more than Rs 100 crore and implemented from January 1, 2021.

Since April 1, 2021, entities with turnover of more than Rs 50 crore have been generating B2B e-invoices, and the limit was reduced to Rs 20 crore starting from April 2022. Since October 2022, the threshold was further lowered to Rs 10 crore, and then from August 2023, the requirement was extended to businesses with a turnover of Rs 5 crore.