How Does the E-Way Bill Work in India?
The e-Way Bill is an electronic document used to declare the transfer of merchandise in India. Its implementation greatly simplified the movement of goods in the country through the homogenization and digitalization of merchandise declarations. This document is obligatory to transfer merchandise throughout the country.
The e-Way Bill and the electronic invoice are electronic tax control mechanisms developed by the Good and Services Tax Council (GSTC), the agency responsible for the management of taxes in India. Both mechanisms derive from the Good and Service Tax (GST) system, and their objective to direct India towards a single digitalized market.
The e-Way Bill is created in the Goods and Services Tax Network (GSTN). It can also be generated through electronic platforms like EDICOM’s Global E-invoicing solution which uses EDI (Electronic Data Interchange) technologies.
This document can be generated by the logistics company carrying the merchandise, the driver, the owner of the merchandise or the recipient of the merchandise. It is used for the land, air, and maritime transport of merchandise.
The e-Way Bill is created before initiating the movement of merchandise. Each document can be identified with an EBN number which is made available to each of the involved parties: issuer, recipient, and transporter. This code is available through the GSTN portal.
To create the e-Way Bill the issuer must be registered in the GST platform and must then register in the e-Way Bill platform.
The e-Way Bill document is composed of parts A and B.
Part A includes the issuer’s and recipient’s identification data (GSTIN); the document’s expiration date; merchandise origin and destination; value of merchandise and reason for transport.
Part B is comprised of data associated to the transport and logistics carrier.
The advantages of the e-Way Bill system are:
- Reduction of tax evasion.
- Homogenization of the logistics system in all of India.
- Traceability of merchandise from origin to destination.
- Easier control of merchandise for the authorities.
- More control of logistic operation for all parties involved: suppliers, recipients and logistics operators.
- Faster processes