NEW DELHI: The government is looking at ways to bring petroleum products under the ambit of the proposed goods and services tax (GST) with the consent of states, oil minister Dharmendra Pradhan told the Lok Sabha on Monday even as passage of the bill remains uncertain.
“Petroleum products will be brought under the GST, but I don’t know when. Since we have a federal structure, we have to get the consent of states. We are exploring various ways,” he said during question hour. Petroleum products have been kept out of the purview of GST but an in-principle decision has been taken to bring them under the proposed uniform tax regime.
GST would entail uniform tax rate on petro-products, if they are brought under the new tax, and eliminate wide variation in fuel prices. But since states make healthy earnings from sale of petroleum products by heavily taxing them, many have opposed bringing fuels and lubricants under the GST.
“Seventy-five per cent of the profits to be incurred through the DBT in kerosene would be distributed among the states,” Pradhan said, adding that plans were afoot to make Haryana a kerosene-free state after ridding Delhi and a few other Union Territories of the fuel.
Pradhan said despite international crude prices going down, cost of refining, transportation and other costs have not gone down. He said India being a welfare state, the benefits are being passed on to the people by way of better roads, good hospitals and other facilities.