New Delhi: The GST Council could consider bringing natural gas within the purview of Goods and Services Tax in its next meeting, as per Zee Media sources.
While petroleum products like kerosene, naphtha and LPG are under the ambit of GST, five items in the basket -- crude oil, natural gas, aviation fuel, diesel and petrol -- have been excluded during the initial years, replacing over a dozen central and state levies like central excise, service tax and VAT with a single uniform levy.
Sources told Zee Media that states including Punjab and West Bengal have submitted their natural gas based revenue model to the GST council. Reportedly Gujarat and Maharashtra would also submit their revenue model to the council in the next few days.
Inputs like natural gas are used for power generation as well as in manufacturing fertiliser, petrochemicals and a variety of products like glass. Crude oil is used to make petrol and diesel as also kerosene, LPG and industrial fuels like naptha, fuel oil and bitumen.
While other industries can claim input tax credit or set off tax paid on inputs with that paid on the final product, these industries cannot do so as crude oil, three petroleum products and natural gas are out of the GST's ambit. This raises cost for the industries using either of the five products as inputs.
The one nation, one tax united at least 17 different central and state indirect taxes under one umbrella to cut tax evasions and reduce corruption.