Indian petroleum industry has sought gas to be brought under GST ambitNew Delhi: The petroleum industry in the country has actually advised the federal government to bring gas under the ambit of Product and Services Tax (GST) routine to understand the objective for a gas-based economy and raising its share in India's energy basket.Natural gas is currently outside the ambit of GST, and existing taxes like central excise responsibility, state VAT and central sales tax continue to be applicable on the fuel.In its pre-budget memorandum to the finance ministry, Federation of Indian Petroleum Industry (FIPI), also demanded rationalisation of GST on transport of gas through pipeline along with on re-gasification of imported LNG to help lower expense of the environment friendly fuel.Government has actually set a target of raising the share of gas in the country's main energy basket to 15 per cent by 2030, from 6.2 percent currently.
Greater usage of natural gas will cut fuel expense in addition to lower carbon emissions, helping the country satisfy its COP-26 dedications.
Non-inclusion of gas under the GST regime is having unfavorable influence on gas prices due to stranding of taxes in the hands of gas producers/suppliers and is likewise impacting natural gas-based industries due to stranding of legacy taxes paid on it, FIPI said.Value included tax or barrel on natural gas is really high in some states like Andhra Pradesh, which levies 24.5 percent tax, Uttar Pradesh 14.5 per cent, Gujarat 15 per cent and Madhya Pradesh 14 per cent.Inclusion of natural gas under GST is needed to provide uniform tax and to motivate free trade of it throughout the country without any tax anomalies.
This is among the key prerequisites for the development of gas exchange in the country, it said.