Tamil Nadu Chamber of Commerce and Industry for inclusion of petrol, diesel under GST regime

CHENNAI: The Tamil Nadu Chamber of Commerce and Industry (TNCCI), Madurai, has sought the Centre to bring essential commodities like petrol and diesel under Goods and Services Tax (GST) regime. Now, taxes on petroleum products in India are among the highest, globally.

When GST was introduced across the country in July 2017, five commodities including crude oil, natural gas, petrol, diesel and aviation turbine fuel were kept out of the GST purview. Article 279A (5) of the Constitution provides that the GST Council shall recommend the date on which goods and services tax could be levied on petroleum crude, high-speed diesel, motor spirit, natural gas and aviation turbine fuel. Thus while petroleum products were constitutionally included under GST, it has to be levied on such goods, N Jegatheesan, president, TNCCI, Madurai, said on Wednesday.

While the Union government is imposing excise duty, the states levy value-added tax (VAT) on sales of petrol, diesel and other petroleum products. Bringing petrol and diesel under GST would mean subsuming the current excise duty and VAT into one national rate. Excise duty and VAT account for more than half of the retail prices of petrol and diesel. The highest tax slab for GST is 28 per cent. Hence, if petrol and diesel was brought under the GST purview, prices of diesel and petrol would come down substantially. It is high time that petroleum products including petrol, diesel and aviation turbine fuel are brought under the single nationwide GST regime, he said.

The inclusion of petroleum products into GST would certainly help people a lot and the economy as well. The soaring prices of petrol and diesel have a huge cascading effect on a number of sectors, ultimately impacting the common people, especially the poor. The trade and industry could avail of the input tax credit, he said.