E-way bill ! Are we really ready?

E-way bill ! Are we really ready?

Well, we all know that even after 2 months of GST roll out, there are many things that still need a little more understanding and simplification. No doubt that, implementation of GST by abolishing all the major indirect tax policies is one of the biggest step taken in the history of tax reforms. Through this article, We are not going to rant about GST again, its benefits, tax implications etc., instead we are trying to understand how helpful or problematic can GST be for the logistics and warehousing sector.  

Like every other sector, implementation of GST is set to bring about a change in the logistics sector as well. GST has introduced E-way bill in the sector, which has replaced the traditional way of billing in the transportation as it says, a consignment worth INR 50,000 requires an e-way bill, otherwise cannot be transported to the destination. Due to this policy, the transporters need to upload their details on the GSTN portal, through which an e-way bill will be generated and then the consignment could be transported. It also encourages the transporters to install RFID systems in trucks, so that vehicles could be auto verified which in turn would help in reducing the time consumed on the check posts. But this should be considered to be a push to free flow of goods and not a trap of cumbersome rules and procedures.

Indeed, it is a good step in digitizing the operations in logistics sector, but it requires further simplification. The problem arises here; firstly, most of the transporters in India are not much tech-savvy, they obviously know the basics of using technology but RFID systems and using GSTN portal for generating E-way bill is something that they need to learn about; Secondly, internet connectivity in India is a big issue as many places are still deprived of internet services and on the road internet availability is quite limited, thus generating bills or getting information on the go seems a bit difficult.

Though it is not difficult to digitize the logistics sector, but what we believe is that, if procedures are more simplified, transporters are educated about the use of this technology and internet services are improved, it could be a revolutionizing step for the industry. Yes, government has promised to give time to the transporters to adjust to the regime, but in our opinion more time should be invested to understand the needs of the industry right now for adapting itself to E-way bills in its operation, before its full-fledged implementation, otherwise the purpose could be defeated.

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