Daily average E-way bill generation in May dipped to 12.15 lakh against over 19.58 lakh in April. The impact of this will be seen in the GST collection for May, data for which will be formally released on July 1.
Experts feel that even collection in May ( basically for all the transactions done in April) will be between ₹ 90,000 and ₹1.10-lakh crore or even lower. Even RBI has estimated lower collection in coming months. Earlier this month, the Finance Ministry said collection in April had reached an all-time high of ₹ 1.41-lakh crore.
Data from GSTN (the IT system for GST) show a total of 1.94 crore E-way bill generated during May. Still, the daily average of May is not just lower than April’s but much below March’s 23 lakh. It may be recalled that average daily generation of E-way bill was around 8.50 lakh during May last fiscal.
Though “it is better than last year, the current lockdown is affecting businesses harshly, registering a regular steep decline in E-way bill generation,” a senior Government official. 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.
GST mop-up may be hit
Impact of lower generation of E-way bill can be seen in the GST collection. The Reserve Bank of India, in its monthly bulletin for May, released on Monday, has said that the problem started in April itself, when many States started imposing local lockdowns. “E-way bills — an indicator of domestic trade — recorded double digit contraction at 17.5 per cent month-on-month (m-o-m) in April 2021, with intrastate and inter-state e-way bills declining by (-) 16.5 per cent and (-) 19 per cent, respectively. This could be pointing to a moderation in GST collections. in coming months,” the bulletin said. Further it noted that despite the sharp decline, total e-way bills remained above the pre-pandemic baseline of February 2020, indicating that domestic trade has remained resilient on the back of digitisation of sales platforms.
Experts say GST collection from now on is expected to be on the decline. Rajat Mohan, Senior Partner at AMRG & Associates, said lockdown in major cities and wide exodus of people in the lower strata of society to their villages has resulted in zero movement of goods. Especially, all infra and real-estate projects have stalled.
“Practically there is no major movement of goods for business consumption, thereby falling E-Way bills. Lowering of E-way bills indicates that Tax collection for May 2021 would nosedive compared with April 2021,” he said.
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