India: Bring Petroleum Products under GST Ambit

The Bangalore Chamber of Industry and Commerce (BCIC) has urged the GST Council to bring petroleum products under GST ambit in a bid to mitigate the impact of sky-rocketing petroleum prices. In a two-month span, petrol prices have increased by Rs. 15 per litre in Bengaluru and in other parts of the country. According to Mr. Raju Bhatnagar, Secretary General, BCIC, it is well within the executive powers of the GST Council to bring petroleum products under the ambit of GST. “In our view, this is the only way out to offset the increase in prices of petrol and diesel.”

Crude prices have surged recently because of the decision by oil-producing countries to reduce production. Currently, taxes on petroleum products constitute nearly 50% of the retail prices. A sharp recovery in global crude oil prices, which is up 47% since July 1 last year, is estimated to have expanded India’s oil import bill to $88-bn in 2017-18 from $70-bn in the previous year. India imports nearly 82% of its oil requirement.