Five commodities including crude oil, natural gas, petrol, diesel and aviation turbine fuel have been kept out of the GST purview since July 2017.
The 45th Goods and Services Tax (GST) Council, which includes the Centre and states, meets in Lucknow today. This meet is very important in terms of how the consumer can get some relief from the ever-increasing petrol and diesel prices. The question is whether petrol and diesel will be brought under the goods and services tax (GST) ambit.
The GST Council meet is expected to decide on bringing petrol and diesel within the ambit of indirect tax and reducing taxes on COVID-19 medicines. After December 18, 2019, this is the first on-ground GST Council meeting. Recently all the GST Council meetings were done in virtual mode due to the ongoing COVID-19 pandemic.
Earlier, the Kerala High Court on June 21, had directed that petrol and diesel should be included in GST, as fuel prices crossed the Rs 100 mark this year in some places. Looking at the record high price for fuel, the court said that the GST Council should consider bringing petrol and diesel under GST.
Five commodities including crude oil, natural gas, petrol, diesel and aviation turbine fuel (ATF) have been kept out of the GST purview since GST was introduced in July 2017. This was done considering the revenue dependence of the Central and state governments on the tax levied on them.
Agenda of GST Council meet 2021
The meeting is likely to discuss levying GST on petroleum crude, high-speed diesel, petrol, natural gas and aviation turbine fuel (ATF).
The Council is likely to discuss extending the GST rate reduction from 12% to 5% on four important medicines required for the treatment of COVID-19.
This includes Tocilizumab, Amphotericin B, Remdesivir and anti-coagulants such as Heparin till December 31. Currently, it is valid till September 30.
GST compensation of Rs 1,13,000 crore has been released to states since April 2020 but this is not enough to meet the full amount expected by states.
This is because of the impact of the COVID-19 pandemic on Goods and Services Tax (GST) and GST cess collection.
The GST Council is likely to discuss treating food delivery services including takeaway and door delivery services as 'restaurant service'.
All 'restaurant service' may draw five per cent GST, a media website quoted sources.
Impact on consumers
Removal of tax inefficiencies is likely to benefit consumers and make companies more competitive.
Sensitive auto fuels are heavily taxed by the central and state governments. Bringing them under GST could lead to a reduction in the tax burden.
If the GST council decides to cover fuel prices under its regime, then there will be a maximum tax of 28% on the base price across the country.
This means the different excise and VAT that the Centre and states levy on the fuel prices will be replaced with a uniform GST rate across the country.
Considering the revenue dependence of the central and state governments on the tax collected from petrol sales, it will be a tough call for the GST Council.
The tax concessions on drugs for the COVID-19 cure will be a big relief as people are already burdened with huge medical expenses due to the pandemic.
The proposal to treat food delivery apps such as Zomato and Swiggy as restaurants would affect the common man.
This will mean ordering food online will become more expensive if a five per cent GST is levied.
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
 "GST Council meet: How GST on petrol-diesel will impact consumers?")
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
)
){kind=small}
){kind=small}
)
)
)
)
)
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}