The Economic Survey 2026 has called for the next wave of Goods and Services Tax (GST) reforms aimed at lowering business costs, easing working capital stress and transforming the e-Way Bill system into a facilitator of smooth logistics rather than merely an enforcement tool.
According to the Survey, the recent next-generation GST 2.0 reforms have already addressed inverted duty structures (IDS) in key labour-intensive and agri-input sectors such as textiles and fertilisers.
“Any residual IDS issues arising from such rationalisation are being addressed through faster, fully automated refunds of unutilised Input Tax Credit (ITC), thereby alleviating working capital stress. Going forward, policy options such as permitting IDS refunds on capital goods and input services may be examined to preserve tax neutrality without significant revenue erosion,” the Survey said.
The Survey linked recent improvements in high-frequency economic indicators to the impact of GST reforms. Adding that higher e-way bill generation, improved Purchasing Managers’ Index (PMI) readings for both manufacturing and services, record festive-season automobile sales, robust Unified Payments Interface (UPI) transactions and rising tractor sales point to strengthening economic momentum during September–December 2025.
Recalling the structural transformation brought by GST in 2017, the Survey highlighted that the removal of physical check-posts across states significantly improved the free movement of goods and reduced transit delays. The e-Way Bill system emerged as a digital substitute that enabled online tracking of goods movement while supporting tax administration.
However, it cautioned that mobile-based checking of e-Way Bills at interior locations can sometimes cause avoidable logistics disruptions and compliance friction for genuine businesses.
To address this, the Survey proposed that the next wave of GST reforms should reimagine the e-Way Bill system as a logistics enabler. A key suggestion is the adoption of trust-based, technology-driven compliance models, including a “trusted dealer” framework, under which taxpayers with strong compliance records face minimal physical checks and enjoy greater certainty in the movement of goods.
The wider use of e-seals and electronic locking systems integrated with e-Way Bills and vehicle-tracking technologies has also been suggested to ensure secure, end-to-end tracking of consignments without routine stoppages.
State governments, which play a central role in field-level enforcement, are expected to be crucial to this transition by shifting towards risk-based, system-generated alerts and limiting discretionary checks.
Taken together, the Survey said these measures could amount to a significant deregulation of the logistics ecosystem, lowering costs and delays for trade while maintaining effective, non-intrusive oversight for tax administration.
