Daily Current Affairs 2020 Govt Makes it Mandatory to Mention 8-digit HSN Code in Tax Invoice for 49 Chemical Based Products | Daily Current Affairs 2020

Govt Makes it Mandatory to Mention 8-digit HSN Code in Tax Invoice for 49 Chemical Based Products

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In trade parlance, every product is categorised under an HSN (Harmonised System of Nomenclature) Code. It helps in systematic classification of goods across the globe.

The government has made it mandatory to mention 8-digit HSN or tariff code for 49 chemical based products while issuing Goods and Services Tax (GST) invoice, a move experts feel is aimed at curbing tax evasion. While notifying the HSN Code for these products, the Central Board of Indirect Taxes and Customs (CBIC) said, A registered person shall mention eight number of digits of HSN Codes in a tax invoice issued by him. Currently, businesses mention up to 4-digit tariff code while issuing invoices.

In trade parlance, every product is categorised under an HSN (Harmonised System of Nomenclature) Code. It helps in systematic classification of goods across the globe. AMRG & Associates Senior Partner Rajat Mohan said CBIC has notified every supplier of specified chemicals to mention 8 digits of HSN Code in every tax invoice issued by him for the said goods from December 1, 2020, irrespective of the scale of operations.

This is the first notification of its kind whereby a specific category of suppliers are pushed to use 8 digit HSN Code on every invoice irrespective of the aggregate turnover. Although there is no reason for cornering the supplier of specified chemicals, it seems that it is carried out to break the fake invoicing ring, Mohan said. EY Tax Partner Abhishek Jain said, CBIC has mandated 8 digit HSN classification for 49 chemical based products, to be mentioned at the time of issuing GST invoice, which was currently placed at 2 digits/4 digits depending upon turnover.

Pursuant this, industry players dealing in these goods will have to undertake HSN classification at 8 digit level for their products along with requisite ERP (Enterprise Resource Planning) changes.

Source: News18

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