Welcome Guest! You are here: Home » Business & Economy

It is upto GST Council to decide when GST can be levied on petroleum products: Govt

If the petrol and diesel prices are brought under GST, the price of petrol can come down to Rs 38.1 per litre in Delhi

Wednesday January 2, 2019 11:25 PM, ummid.com News Network

GST on Petrol

New Delhi: The Modi Government on Wednesday told the Parliament that only the GST Council can decide when Goods and Services Tax or GST can be levied on petroleum products.

"Article 279A (5) of the Constitution provides that Goods and Services Tax Council shall recommend the date on which goods and services tax shall be levied on petroleum crude, high speed diesel, motor spirit, natural gas and aviation turbine fuel", Minister of Petroleum & Natural Gas, Dharmendra Pradhan said in a written reply to the Rajya Sabha Wednesday.

"Thus while, petroleum products are constitutionally included under GST, the date on which GST shall be levied on such goods, shall be as per the decision of the GST Council. As per the section 9(2) of the CGST Act, inclusion of all excluded petroleum products, including petrol and diesel in GST will require recommendation of the GST Council", he added.

The prices of petroleum products in the country are benchmarked to international product prices. Generally, the prices of sensitive petroleum products in the country are higher/lower than other countries due to various factors, including prevailing tax regime and subsidy compensations by the respective Governments, the minister said.

"All the States and Union Territories (UT) with Legislature are represented in the GST Council by their Minister-in-charge of Finance or Taxation or any other Minister nominated by the State/UT. Any decision regarding levy of GST on petroleum products has to be decided as per recommendation of the GST Council", he reiterated.

Prices of petrol and diesel in India are manifold because of heavy taxes imposed by the central and state governments. Demand to bring petrol and diesel under GST has been constantly being raised and it was also supported by the petroleum minister.

"We have to have a rational tax management. Both the state and union governments have to come to this consensus that petroleum products must come under the GST mechanism", Pradhan had said in September 2017.

According to data released by the Indian Oil Corporation, the fuel costs only Rs 26.65 at the refineries. Dealers get a litre of petrol at Rs 30.70. But, petrol is sold at Rs 70.39 a litre in Delhi. This means Rs 39.41 is charged as tax component and dealer's commission on every litre of petrol sold in the national capital.

Analysts calculate that if the petrol and diesel prices are brought under GST, the price of petrol can come down to Rs 38.1 per litre in Delhi. As for diesel, its current price in Delhi is Rs 58.72 per litre. At 12 per cent GST, diesel will sell at Rs 36.65 in the national capital.

For all the latest News, Opinions and Views, download ummid.com App.

Select Language To Read in Urdu, Hindi, Marathi or Arabic.

Share this page

 Post Comments
Note: By posting your comments here you agree to the terms and conditions of www.ummid.com