GST e-invoicing may widen to service imports

India's government plans to expand e-invoicing to imported services and purchases from unregistered suppliers within the goods and services tax (GST) system. This proposal, recommended by the 57th GST Council, targets businesses with annual turnovers of ₹5 crore or more. Currently, Indian businesses must issue self-invoices for imported services under the reverse charge mechanism as overseas suppliers do not issue invoices in Indian GST format.

This extension aims to streamline reporting and potentially reduce discrepancies in tax liability and input tax credit (ITC) claimed. The council also proposes a mechanism to rectify tax liabilities and ITC reported in GST returns, which will be presented for stakeholder consultation before April 2027. Implementing these changes may necessitate modifications to existing accounting systems, particularly in invoice validation and vendor checks, to ensure seamless integration with the Invoice Management System (IMS) that facilitates GST compliance.