NIC drops plan to tighten e-way bill rules

Goods and Services Tax (GST) authorities have dropped a plan to block generation of goods transportation permits, or e-way bills, from 1 March for companies that fail to produce 'e-invoices' for their wholesale transactions through designated portals.

- Gireesh Chandra Prasad

These portals aid in more accurate data capturing across various tax forms using a standardized invoice.

This decision likely stems from the difficulties businesses, particularly small and medium enterprises, face in generating e-invoices, including increased paperwork and the need for technological upgrades.

E-invoices, readable across different softwares, eliminate the need for re-entering data and promote tax compliance.

They automatically update transactions in other tax documents such as e-way bills and GST returns.

The initial plan to deny transportation permits to firms not issuing e-invoices for business-to-business transactions aimed to boost tax compliance. The heightened reporting demands under the GST regime contribute to the economy's formalization and tax compliance.