Advantages and Disadvantages of e-Way Bill System

One of the most important aspects of GST reforms was the introduction of the e-way bill system. Coming into effect on 1st April 2018, the e-way billing system mandates the generation of e-way bills for consignments worth more than Rs.50,000, which are moved between or among states. 

Before transporting goods, the e-way bill should be prepared and should contain details of the products being transported, the consignor, the destination, and the transporter. The driver or person in charge of the vehicle must have the e-way bill, the portal number, the tax invoice, the delivery challan or bill of supply, if applicable. This article explores most of the advantages and disadvantages of the e-way bill.

What is an e-Way Bill?

An e-way bill is a mandatory document to be carried in any conveyance carrying goods of value over Rs.50,000 across different locations. It is created from the GST Common Portal and generated in case of movement or before the commencement of such movement.

Advantages of e-Way Bill System

Less Documentation: 

Moving commodities across or within the states now doesn’t require significant documentation. The RGID device in the vehicles transporting consignments regularly is an advantage for transporters. The e-way bill may now be mapped and validated using the RGID device in the automobile, negating the requirement for the person in charge of it to carry it physically. It avoids the inconveniences of carrying and storing physical documents.

Cost Reduction:

e-Way bills help minimise logistics costs by ensuring correct invoicing and minimising tax evasion. Also, in the future, the ratio of logistic costs to GDP will likely decrease, which at present is high compared to other countries.

Fast and Efficient Transportation: 

The introduction of the e-way bill has significantly increased the speed and efficiency of the entire transportation system. It decreased the number of cross-border checkpoints across state routes. 

Simple and Quick Generation of e-Way Bills: 

The government-established web portal generates and cancels e-way bills. On the other hand, the e-way bill system and the site are incredibly easy to use. Dealers can self-generate e-way bills using the system. e-Way bills can also be generated using an ideal billing software.

Disadvantages of e-Way Bill System

Despite these benefits, introducing e-way bills had certain difficulties and issues. These constraints mostly affected the logistics sector, which had difficulty adjusting to the new protocols. However, the Government is continuously revising its policies, guidelines, and legal framework to make things easier and more flexible for dealers and carriers. 

Challenges with compliance for several daily movements: 

Businesses that transport items several times daily face new compliance challenges. The firms require a software program to produce the electronic waybill on schedule. Reconciliation of turnover with e-way bills should also be possible using the software.

Internet-based system: 

The electronic way bill system is a comprehensive system based on the Internet. Creating the e-way bill becomes difficult in places and areas with inadequate internet access. Moreover, dealers and transporters need to be more familiar with technology or the Internet and need help sending out items.\

Technical error: 

Despite the e-way bill portal’s estimated daily capacity to generate 75 lakh e-way bills, companies are concerned that the system won’t experience much downtime as additional states come under the intra-state e-way bill’s jurisdiction. The logistics sector faces significant challenges due to technological issues in electronically generating way bills.

Due to technical difficulties, the Government was forced to postpone the e-way bill’s implementation several times. However, these technological hiccups still cause delays and inconveniences since they cannot be avoided.

The introduction of the e-way bill has successfully diluted interstate transport, among other things. The time required for document verification at state borders was a barrier for all firms. It frequently deterred them from relocating outside of their state. However, things have changed with the new system. Furthermore, the administration has been working nonstop to install a system that functions flawlessly.  


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