Slowly yet prominently, e-invoicing is becoming a reality throughout the whole world.
And fortunately, the Asian market is progressing extremely prominently in this aspect. So, in this article, we are going to look at three countries that are advancing the most here –
● Singapore, and
But before we get started, there’s something you must know about e-invoicing. The types of implementation strategies usually vary from one country to another.
However, the continent’s core integration stratagem is becoming increasingly inclined towards the European-grown and -developed Peppol standard. Hence, you might find some similarities between European countries and Asian ones.
Anyway, now that we got that out of the way, let’s start our discussion right away.
E-Invoicing in Asia – How Does the Scenario Look Like?
Before we focus on the three aforementioned Asian countries, let’s look at what the e-invoicing scene in the continent looks like.
Launching in 2022
In this section, we’ll share some insights on some countries that have already implemented or will be integrating in 2022. So, let’s begin.
In contrast to other neighbouring countries, Japan didn’t proclaim its intention to integrate any specific e-invoicing standard previously. But, recently, the government has announced that it’ll base its system on the prevalent Peppol network.
2: New Zealand and Australia.
Both New Zealand and Australia officially introduced e-invoicing in 2019. They are using the same Peppol network and expanding it with data fields that accommodate all of their local and international requirements. The countries are also guaranteeing a prompt payment system.
Like the aforementioned countries, the Philippines, too, will launch an e-invoicing program in 2022. A nationwide version will be rolled out after a year. Technically, the whole infrastructure is going to be based on a similar portal technology known as e-Tax.
In the Works
Unlike the other countries, these are yet to roll out their version of e-invoicing. Here is what you need to know about it.
Malaysia has been attempting to create and establish its e-invoicing standard. And according to a report, the initial strategy is already in place. However, it’s still yet to be released and implemented due to additional drawbacks.
In most countries, companies are needed to send their outgoing invoices by regarding them as e-invoices. But only some specific companies have permission to do it. However, in Thailand, it’s only a matter of receiving authorisation for the same.
E-invoicing in Malaysia
As per the Pre-Budget Statement (2023) published by the Ministry of Finance, e-invoicing will also become a reality in Malaysia. The goal is to strengthen the finance of the nation and build sustainable socio-economic resilience within the country.
The Initiative in Malaysia
E-invoicing will apparently be an integral part of the Malaysian financial system, and it’ll try to uplift the growth of the digital economy in the country. Integrating electronic invoicing will also reduce compliance-related costs and improve the quality of services as a whole.
As mentioned before, there’s a fundamental strategy already in place regarding the same. But, it is subject to change in the near future. Thus, we still don’t have any information about what the invoicing structure of the country will look like in the future.
E-invoicing in China
Unlike Malaysia, China is currently in the process of re-establishing and reforming the current invoicing system. At this moment, it’s only mandatory for the new taxpayers in the country in
a specific segment, like the B2B or B2C areas. And following the same will be voluntary for the others. However, it will become a mandate after the reformed, nationwide launch.
Here are some elements of the Chinese e-invoicing system that you should know about –
● The tax authority that overviews and assesses the whole system is STA (State Taxation and Administration).
● Currently, it’s only mandatory for people who have started paying taxes recently. An older taxpayer will join the same voluntarily.
● The format that you need to follow while sending an e-invoice is XML. Having a digital signature will be mandatory for you.
● There should be a QR code available in the printed format of the e-invoice.
● An invoice must have a unique code. These can be requested from the government’s tax authority, namely STA.
● An e-invoice can be archived for only ten years. Not more than that.
The name of the e-invoicing system in China is e-fapiao. Two categories are available for it – a special e-fapiao and a general e-fapiao.
The latter is generally issued when the sale of an item or service isn’t VAT deductible. On the other hand, the former will be issued only when a transaction is VAT deductible.
E-invoicing in Singapore
In the year of 2019, IMDA, the Peppol authority in Singapore, established and launched its new national e-invoicing network, InvoiceNow. It’s done to digitise the country’s economy and leverage the advantages of e-invoicing. In turn, it will help organisations boost their overall efficacy, decrease costs, and become much more sustainable.
IMDA prompts the use of e-invoicing to structure its financial ecosystem. Here are some of the elements that you should know about it –
● The tax authority overviewing Singapore’s e-invoice system is IMDA (Infocomm Media Development Authority).
● There’s no obligation to follow it by law. However, IMDA still strongly promotes e-invoices, especially the B2B and B2C companies.
● The format of presenting the e-invoice should be SG Peppol BIS Billing 3.0.
● There’s no need to provide any digital signature.
● The archiving of the same will be done for five years only.
The Final Say
Unlike European countries, Asia has yet to establish a well-built e-invoicing system truly. But, with the way the whole environment is growing, we expect it to be found within 2027. Some countries, like China or India, are also trying to reform their infrastructure.
So, once all these are done, the market will grow exponentially and become more prominent. However, there’s still time before the prominence gets established.