New GST returns system will now be implemented from October 2020. Know through this article, how the e-way bill system gets affected due to the changes proposed under the new return system.
Latest update on 14th March 2020*
The new GST return system will be implemented from October 2020.
The present return filing system (GSTR-1, 2A & 3B) will continue until September 2020.
*Subject to CBIC notification
Update as on 20th September 2019
As per the decision taken at the 37th GST Council Meeting, the new GST return system for all taxpayers and for all forms will be implemented from April 2020.
1. What is an E-Way Bill?
An e-way bill is an electronic way bill for the movement of goods. It has to be generated on the e-way bill portal. A person registered under GST cannot transport goods in a vehicle without an e-way bill, if the value exceeds Rs 50,000.
An e-way bill ensures that the goods are transported in line with GST norms and the relevant data is uploaded before the commencement of transportation of goods. This is a means to track the movement of goods and avoid tax evasion.
2. How are E-Way Bills currently generated?
Under the present system, an e-way bill is to be generated on the GST portal, whenever there is a movement of goods in a vehicle, and the value of the consignment exceeds Rs 50,000. If there are multiple consignments in a single vehicle, then an e-way bill needs to be generated for those consignments whose value exceeds Rs 50,000.
The movement could be-
For all the above types of movements, an e-way bill must be generated on the common portal.
However, there are two more cases, where, even if the value of a consignment is less than Rs 50000, an e-way bill needs to be generated; such as-
- In relation to a supply
- For reasons other than supply
- Due to inward supply from an unregistered person
Here is a Step by step guide on how to generate an e-way bill on the GST portal.
- The inter-state movement of goods to a job-worker by a principal or a registered job-worker
- The inter-state transport of handicraft goods by a dealer, which is exempt from GST
3. What are the changes introduced in the New Return System with regard to E-Way Bills?
Under the New Return System, the Government plans to integrate GST returns with e-way bills. With this integration, the Government is planning to disallow taxpayers from using the e-way bill site from generating e-way bills when they default in filing GST returns for two consecutive tax periods. If a registered dealer has not submitted his GST Return for two consecutive tax periods, he will not be able to furnish details in Part A of GST Form EWB-01. Thus, both the dealer and the buyer will get blocked. This would apply when either GSTR-3B or GSTR-4 return, whichever applicable, is not filed.
4. What is E-Invoicing? How will it be implemented?
Currently, businesses issue invoices through their accounting/billing software and at the time of filing returns, these invoice details are uploaded on the GST Portal. However, under the proposed e-invoicing system, the invoice will be issued directly through the GST network, and all information will be automatically transferred to the portal on a real-time basis. This will eliminate the need for manual data entry.
This new system is likely to get implemented from the 1st of January 2020, and it will apply only to B2B invoices. Hence, no separate e-way bills will be required to be generated thereafter.
With the integration of two systems i.e GST returns filing and e-way bills, the Government aims to meet a two-fold objective. One such objective is to ease data handling by taxpayers. The second is to allow the real-time monitoring of transactions, and to keep a watchful eye on possible cases of tax evasion.