New Delhi, May 26, 2018
Incessant rise in petrol and diesel prices have forced the government to explore solutions that would provide some relief to the buyers.
The list of possible courses of action include bringing petroleum products under the ambit of Goods and Services Tax (GST). However, Bihar Deputy Chief Minister Sushil Kumar Modi has argued that GST would not have much impact in reducing petrol and diesel prices.
"It is a big misconception (among the people) that price of petroleum products will be reduced significantly if they are brought under GST ambit. Instead, the move will have minor impact in terms of reducing prices of petroleum products," said Sushil Modi, who also heads the GST Network panel.
He further added, "Under the GST regime, there is a practice across the world which empowers states to impose tax over and above the highest GST tax rate. This has been the practice followed everywhere in the world where GST has been implemented."
Modi, who is also Bihar's Finance Minister, was replying to a query during the 64th quarterly State Level Bankers Committee (SLBC) meeting as to whether the government is contemplating bringing petroleum products under the GST regime.
He said that the issue of whether or not to include petroleum products under GST will be decided by the GST Council. Petroleum products, along with alcohol, real estate, and electricity have been kept out of the GST regime.
"There is unanimity in the GST Council that petroleum products will not be brought under GST regime until it (the new GST regime) stabilises," Modi said.
Contrastingly, union ministers Nitin Gadkari and Piyush Goyal have reiterated that the government is considering bringing petrol and diesel under the GST regime to control their prices, according to a IANS report. Union Petroleum Minister Dharmendra Pradhan has already revealed a similar plan recently.