Economy

E-way bill generation dips in April, may affect GST collection

Shishir Sinha | Updated on: May 05, 2022
Although lower than the March numbers, the latest e-way bill generation number is nearly 28 per cent higher than April of 2021 figures

Although lower than the March numbers, the latest e-way bill generation number is nearly 28 per cent higher than April of 2021 figures | Photo Credit: Kesavan A N@Chennai

While some attribute it to the slowdown in economic activity, others feel the dip is temporary

After setting a record in March, the e-way bill generation has dipped by around 4 per cent in April. This means the GST collections in May will be lower than the April number.

Experts do not have a uniform explanation for the dip with some saying attributing it to the slowdown in economic activities while others feel it is only a temporary phase.

Higher than April 2021

Although lower than the March numbers, the latest e-way bill generation number is nearly 28 per cent higher than April 2021 figures. E-way bill is required to be generated by a registered GST taxpayer for the movement of goods if the value of the consignment is more than ₹50,000 for inter-State movement.

For intra-State movement, limits vary from State to State. Higher generation reflects more movement of goods within the State and between States.

Based on the monthly data, provided by GSTN, April saw generation of 25 lakh e-way bills on a daily average as against 25.08 lakh every day in the month of March and over 19.58 lakh during April last year. It may be noted that the month of April had seen all-time high GST collections of over ₹1.68-lakh crore. This collection is related to transactions that took place in March. Similarly, collections in May will be related to transactions that took place in April.

Expert opinion

Rajat Mohan, Senior Partner with tax consultancy firm ANRG, said any fall in the number of e-way bills exhibit a drop in the economic transactions, negative impact of which would be seen in the tax collections for the succeeding month. “Economic activity, especially in relation to goods, has gone down in April 2022 which certainly would lead to a fall in tax collections for May 2022 unless the same is compensated by tax collections from other emerging sectors like cryptos and NFT,” he said.

Sandeep Sehgal, Partner (Tax) with AKM Global, a tax and consulting firm, said this could be a temporary trend. Businesses are generally aggressive in March, it being the last month of the financial year to close their sales target, and hence, may clear their stock to show the higher sales. “However, the same gets moderated in the month of April wherein suppliers may have excess stock and may reduce their purchases,” he said.

Published on May 05, 2022
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