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Why relaxed invoicing norms are not good for consumers?

CA Ritesh Gyanchandani 
on 03 November 2017

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When the invoicing norms where laid down initially for retailers Govt. had a plan for the consumers where they tried that every consumer has the right to know how much tax they have paid on which item.

Previous Situation before the recommended changes

Two separate invoice for exempt and taxable goods

So the retailers had to issue two separate invoices if a consumer buys grocery items taxed at 0% and consumer goods taxed at 18%.

Taxable items to be mentioned separately

Also all items had to be mentioned separately along with their prices and taxes. Retailers had argued that the end-customer is concerned with the net sale price and didn't need a detailed tax breakup, but this was rejected by the committee. Committee believed that buyers have a right to know the tax being levied on all goods and services purchased by them. 

Current Situation after the recommended changes accepted by committee

Once invoice for exempt and taxable goods

Now Retailers can issue one invoice for taxable and exempt goods which will be called Invoice cum bill of supply.

Taxable items of same rate can be clubbed

Retailers can issue invoices clubbing all goods taxed at one rate and mention just the total tax, facilitating smaller and less cumbersome invoices. This move is definitely an advantage to the business owners which makes their invoicing process easier and fast.  

Norms can be further relaxed

Relaxed norms of invoicing is a significant relief to the small taxpayers. It would help them further more if the requirement to mention HSN code and also reverse charge norms are bit more relaxed for them.

Take away from this change

Careless customers

Retailers had argued that the end-customer is concerned with the net sale price and didn't need a detailed tax breakup. This point was rejected by committee before but looking at the response from business community and no objection from the consumer side, Govt. allowed this change. As a customer, everyone has to comment on the tax laws, Indian Govt. decision, Politics but no one cared of what tax they are paying and whether it is correct or not.

This is definitely a loss for consumers as this will give a chance to some business owners to charge wrong tax rates and keep the tax with them. Yes this is right but I don't think customer cares as he only has to protest on Facebook or any other social media but when it actually comes to take a stand and backup the decisions of Govt. no one comes forward.

People of India are the backbone of the Govt. and without the support of everyone Govt. will have to bend down in front of business community.

The author is a practicing Chartered Accountant with around 6 years of Post qualification experience.  Currently working as a partner with RGNL and co., providing consultancy to corporate clients on GST.


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