GST on petroleum products only when states and GST council agree, says Sitharaman
Finance minister Nirmala Sitharaman on Friday said that the budget has laid the foundation for increasing consumption and investing in infrastructure for achieving the goal of USD five trillion economy by 2024-25.
Speaking to reporters here, she said the Goods and Services Tax (GST) will be applied on petroleum products once the states and the GST Council together agree to bring the products under the purview of GST.
“It is up to the state and the GST Council, to take the call when they want it,” Sitharaman said while addressing a question posed by the media. She also said that former union minister Arun Jaitley had made a provision in the GST and had included petroleum products in the GST list, but with a zero rate.
“In other words petroleum products have been included in the GST but with no tax on it. As and when the GST Council takes the call it will have a rate decided and the rate would be added (on the products). Whenever the states would be ready to bring in petroleum under the GST, another amendment won’t be required,” the finance minister added.
Currently, petroleum products attract central excise duty and value added tax (VAT) levied by states. While industry captains have repeatedly pressed the government for bringing petro products under GST, states have not been keen on the idea because they rely heavily on VAT for their own revenue.
The finance minister also said that this year’s budget has laid the foundation for a five trillion dollar economy with a majority of the government’s expenditure being for building infrastructure.
“I think we have laid the foundation for increasing consumption and ensuring that government investments go towards building of assets in infrastructure. With this, the cycle to trigger the economy to perform and move forward will be happening. In order to address rural distress, a 16-point action plan has been announced. So, I expect all these to lead towards building a five trillion dollar economy,” Sitharaman said.
Asked about what West Bengal has received from the Budget, she said, “I do not know how I should answer this question of kisko keya mila (which state gets what). I am looking at the point of macroeconomic stability, building assets in the country, money directly going to hands of individuals because of reduced tax rates and so on.”
Sitharaman on Sunday attended two sessions, one with trade and industry representatives, followed by another with economists, academicians and policy experts, before addressing the media.
She said that the government was keen on having continuous engagement with industries and businesses and wanted to play the role of a facilitator in hassle-free payment of taxes.
“The broad message which is apparent is that the government wants continuous engagement with industry and business,” Sitharaman said, explaining her tour of the megacities.
This is the third city where she interacted with various stakeholders since presenting the union budget, with senior finance department officials accompanying her. The two other cities are Mumbai and Chennai.