Govt to roll out e-invoicing after GST

NEW DELHI, INDIA: The Finance Ministry is planning to roll out practice of e-invoicing after the roll out of Goods and Services Tax due in 2010.

“We are working on e-invoicing and could have done something in the last budget but since GST is on its way to be implemented, we held back the decision on e-invoice. Once GST is rolled out then we will work further to roll out e-invoice,” said Sushil Solanki, Commissioner - Central Excise, Custom Board of Excise and Custom, Department of Revenue, Ministry of Finance at an event organized by Confederation of Indian Industries on e-invoicing.

To start with, the government will take big players on board and then implement it across all segments.

The Government of India, under its e-procurement program, has already started partial e-invoicing but still uses some manual notes. Government expects, by 2010, most of the manual notes will be replaced by development in e-invoicing.

Most of the businesses in India have adapted e-business and now the industry is feeling the need to adapt e-invoicing as invoicing forms an integral part of any business. An invoice in paper form is considered legal document.

In India, information Technology Act 2000 provides that electronic document can be treated same as physical document. However, industry feels that the concerned tax legislation does not have the suitable provisions and expects the government to play a key role in removing the legal hurdles and create a conducive environment for adopting e-invoicing.

Highlighting the benefits of e-invoicing, Amreesh Gulati, head products, transaction banking, South Asia, Standard Chartered Bank at the event said, “There are huge amount of trade that happens in the country but it is not shown in the books of the vendor. E-invoicing will increase tax compliance along with tax collection for the government.”

Solanki mentioned that the government is taking note of all facts and studying the pros and cons of implementing e-invoicing.

“We are aware that tax department can play an important role in encouraging e-invoicing. There are a number of issues that we are working on, like connecting small suppliers on e-invoicing platform. But we can bring it in proper shape once the government completes roll out of GST,” said Solanki.