The body of tax professionals has called on the government to make the recently introduced Invoice Management System (IMS) on the Goods and Services Tax (GST) portal more user-friendly. They have suggested incorporating features to add and modify invoices before final submission, a move that could significantly reduce errors and minimise the issuance of notices.
Launched in November 2024, the IMS currently allows recipient taxpayers to accept, reject, or mark invoices as pending, based on the data provided by suppliers.
Need for Modifications in the IMS
Highlighting the limitations of the IMS, the President of the Madhya Pradesh Tax Law Bar Association stated, "The earlier GSTR-2 form allowed users to accept, reject, modify, and add invoices. The current IMS, however, restricts taxpayers to just three options: accept, reject, or pending. This creates a dependency on suppliers for invoice corrections, which not only delays processes but also leads to practical difficulties."
Tax professionals argue that without the ability to modify or add invoices, taxpayers are left vulnerable to discrepancies, increasing their reliance on suppliers' timelines for rectifications.
Addressing Input Tax Credit (ITC) Issues
Chartered accountants noted that approximately 10% of all notices issued by the GST department are related to input tax credit (ITC) discrepancies. This highlights the urgent need for a more robust system to manage these issues effectively.
Experts believe enabling amendments within the IMS could significantly improve account reconciliation, thereby reducing the likelihood of error-related notices.
One tax expert remarked, "Implementing options to modify and add invoices in the IMS will empower taxpayers, enhance compliance, and lead to a more transparent and efficient tax ecosystem. The government must consider these recommendations to ensure the system meets user requirements."
A Call for a User-Centric GST Portal
The association stressed that integrating user feedback into the development of the IMS could transform the GST portal into a more efficient and user-friendly system. This, in turn, would reduce administrative burdens and foster greater compliance.
As the government works to refine the GST framework, tax professionals believe these changes are essential to ensuring a smoother and more effective tax system for all stakeholders.
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