No E – way bills for Non-Filers of GST Returns

Prelims level : Taxation Mains level : Indian Economy and issues relating to planning, mobilization, of resources, growth, development and employment
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In News:

  • Non-filers of GST return for six consecutive months will soon be barred from generating e-way bills for movement of goods.


  • The Goods and Services Tax Network is developing an IT system such that businesses that have not filed returns for two straight returns filing cycles, which is six months, would be barred from generating e-way bills
  • CBIC have detected 3,626 cases of GST evasion or violations cases, involving Rs. 15,278.18 crore in the April-December period.

What Is E-WAY Bill?

  • The e-way bill system was rolled out on April 1, 2018, for moving goods worth over Rs. 50,000 from one State to another. The system for within the State movement was rolled out in a phased manner from April 15.
  • Transporters of goods worth over Rs. 50,000 would be required to present e-way bills during transit to a GST inspector, if asked.

Why this Move Needed?

  • The move has been initiated after recording lower-than-expected revenue collection under GST. Against the budgeted monthly revenue target of Rs 1 lakh crore, GST collections have so far averaged Rs 96,800 crore a month this fiscal.
  • According to the government’s own admission, GST compliance has steadily declined over the past year with 28.75 per cent of regular taxpayers not filing returns in November 2018, against 10.56 per cent in November 2017, an almost three-fold increase in non-filers. Among taxpayers under the composite scheme, non-filers increased to 25.37 per cent in the July-Sept period of 2018-2019 from 15.03 per cent in the same period the previous year.

Significance of the Move:

  • The move would help check Goods and Services Tax evasion. To shore up revenue and raise compliance, strict anti-evasion measures must be adopted.
  • The revenue department is working towards integrating the e-way bill system with NHAI’s FASTag mechanism beginning April to help track movement of goods.
  • Fake invoices to claim input tax credit also increased from only four cases involving Rs 9.75 crore to 499 involving Rs 3894.94 crore.
  • There have been reports that some transporters are doing multiple trips by generating a single e-way bill. Integration of e-way bill with FASTag would help find the location of vehicles, and when and how many times they cross NHAI’s toll plazas.
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