In order to bring an effective tool to curb tax evasion under the Goods and Services Tax ( GST ) regime, the Central Government is planning to launch the system of electronic invoice. The new system will allow the businesses to issue invoices, or bills, directly via the GST Network, and the data will be available to the authorities right away.
I connection with this, the GST Council has set up a committee to look into the feasibility of e-invoicing. It will also study the systems in place in other countries, such as South Korea and some from Latin America. The committee includes GSTN chief executive Prakash Kumar, GST officials from state and central governments as members, and GST Council special secretary Rajeev Ranjan as the convenor.
The move is in the light of increasing reports of tax evasion cases and arrests made by the department after the rollout of the new tax regime from 1st July 2017.
The GST Council has taken a number of measures, like introduction of electronic way bills (e-way), TDS, reverse charge mechanism etc., to clamp down on tax evasion.
However, the recent incidents shows that the above measures were inadequate to control evasion since the evaders uses fake invoices to avail input tax credit.
