In the dynamic regulatory landscape of 2023, several Goods and Services Tax (GST) developments unfolded, significantly impacting Micro, Small, and Medium Enterprises (MSMEs). The Economic Survey for 2022-23 highlighted the resilience of small businesses, noting that GST payments by MSMEs rebounded beyond pre-pandemic levels, reflecting the effectiveness of government interventions.
MSME Economic Activity Index – Sumpoorn: Financial advisory and technology firm Jocata partnered with SIDBI to launch the MSME Economic Activity Index – Sumpoorn. Utilizing consent-led and anonymized monthly sales data from over 50,000 MSMEs, the index provides a comprehensive view of economic activity, replacing traditional survey-based indices.
Udyam Registration Milestone: The Udyam Assist Platform (UAP) played a pivotal role as over 1.10 crore Informal Micro Enterprises (IMEs) sought Udyam registration to qualify for priority sector loans. Launched in January, UAP successfully brought these entities into the formal economic fold.
E-invoicing Turnover Threshold Adjustment: In May, the Central Board of Indirect Taxes and Customs (CBIC) reduced the turnover threshold for e-invoicing to Rs 5 crore, down from Rs 10 crore. This change, effective from August 1, 2023, extended e-invoicing obligations to more small enterprises with turnovers between Rs 5 crore and Rs 10 crore.
Intra-State Supply for Unregistered E-commerce Sellers: Addressing the needs of micro-enterprises, the GST Council, in its 47th meeting in June, approved intra-state supply permissions for unregistered e-commerce sellers with turnovers up to Rs 40 lakh for goods and Rs 20 lakh for services. This move, implemented from October 1, 2023, aimed to facilitate e-commerce activities through platforms like Amazon and Flipkart.
As MSMEs anticipate further reforms, these key GST-related developments in 2023 shaped the landscape for small businesses navigating regulatory changes.
