Clamour grows to bring petroleum under GST ambit, J&K fires 1st salvo

Now that GST rates for over 500 services and 1,200 goods have been finalised, the clamour to get petroleum products in the Goods and Services Tax (GST) net is growing, with the first salvo being fired by Jammu and Kashmir. While products like kerosene, naphtha and LPG will be under the ambit of GST, five items — crude oil, natural gas, aviation fuel, diesel and petrol — have been excluded from the basket for the initial years. In an interview to PTI, J&K Finance Minister Haseeb Drabu said the five excluded petroleum products have to be brought under the GST "otherwise what is the point of "the biggest shakeup in the nation's tax system since independence. "Why dilute the structure, if you have moved and created an architecture, now don't destroy it by making all these silly things (of excluding products)".

These comments echo the views of various experts who want these products included in the GST right from the start. Drabu, who last week hosted the 14th meeting of the GST Council, which decided on the tax rates for a plethora of goods and services, said the rollout of the new indirect tax regime is in the last lap now. "I think July 1 (for rollout of GST) is doable," he said, adding that the twin issues of information technology that will support administration of the new tax system, and awareness among tax payers need to b e addressed, reports PTI.

"We have moved from a system of assessed to self assessment. It's a huge change. So awareness is required. Information technology will have glitches, I mean any system will have issue. But I think July 1 is doable," he said. He said there wasn't enough time as Constitutional Amendment passed by Parliament, and ratified by at least half of the state legislatures, provide for moving to the new tax system by mid-September. "You have to have a deadline. You do not have enough time, because by September 18 you run into a constitutional crisis."