(TT)
A sustained drive has been initiated to bring natural gas under GST – with just three days to go for India’s biggest indirect tax reform. The petroleum ministry is pressing for the inclusion of natural gas and there is growing optimism the clean fuel will come under the GST umbrella, in the five-per-cent bracket. The arguments for entry are two-fold: the share of clean fuel in the total energy mix will go up. Second, analysts fear its exclusion will have an inflationary impact.
Natural gas alternatives such as naphtha, fuel oil and LPG are already included in the goods and services tax (GST). While LPG will be taxed at 5 per cent, naphtha and fuel oil will be taxed at 18 per cent.
Oil ministry officials pointed out the non-inclusion of natural gas will impact the cost of production of other items such as power, fertiliser, petrochemicals and even public transport. At present, crude oil, petrol, diesel, jet fuel or aviation turbine fuel (ATF) and natural gas are not included in the new indirect tax structure, which is set to kick in from July 1.
