GST Council Has Not Discussed Any Proposal To Include Petrol & Diesel Under GST: Centre In Lok Sabha

Proposal to bring petrol and diesel under GST has not been discussed in GST Council, the Central Government stated in Lok Sabha today.

The Finance Ministry, however, said that it is in receipt of certain representations to bring petrol and diesel under GST.

"Inclusion of these products in GST will require recommendation of the GST Council. So far, the GST Council, in which the states are also represented, has not made any recommendation for inclusion of these goods under GST.", the Minister Pankaj Choudhary stated.

The minister was answering the query made by five MPs. In response to their query whether the GST Council has discussed about bringing petrol, diesel and LPG under the purview of GST and has also consulted the States in this regard, the minister stated thus : "The Council may consider the issue of inclusion of petrol and diesel at a time it considers appropriate keeping in view all the relevant factors including revenue implication. No such proposal to bring petrol and diesel under GST has been discussed in GST Council. As regards LPG, the same is already under GST."

The MPs had also sought the details and total number of essential items/ services which are not covered under the Goods and Services Tax (GST) since its implementation along with the reasons for not including petrol and diesel under GST. "Article 279 A (5) of the Constitution prescribes that the Goods and Service Tax Council shall recommend the date on which the goods and services tax be levied on petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural gas and aviation turbine fuel (ATF). Also, as per the Section 9(2) of the CGST Act, inclusion of these products in GST will require recommendation of the GST Council. So far, the GST Council, in which the states are also represented, has not made any recommendation for inclusion of these goods under GST.", the reply stated.

Responding to the query about the steps taken to reduce the prices of petroleum products, the Ministry stated that the prices of petroleum products are linked to the price of respective products in the international market. Oil Marketing Companies take a decision on retail selling price based on various factors including international product prices, exchange rate, tax structure, inland freight and other cost element, it said.

"Prices of petrol and diesel are market-determined with effect from 26.06.2010 and 19.10.2014 respectively. Since then, the Public Sector Oil Marketing Companies (OMCs) have been taking appropriate decision on pricing of petrol and diesel on the basis of international product prices and other market conditions. . The OMCs have increased and decreased the prices of petrol and diesel according to changes in international prices and rupee dollar exchange rate.", the reply reads.