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Options for Revenue Neutral GST for Oil & Gas

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12-June-2015  

Options for Revenue Neutral GST for Oil & Gas

As a result of PetroFed representations before the Standing Committee of Parliament as well as the Empowered Committee of State Finance Ministers, the current Constitution Amendment Bill does not exclude crude oil & select petroleum products. Stating this, Shri R.S. Butola, former Chairman, IndianOil stressed that we should take the matter forward and ensure inclusion of all petroleum products in the scheme of GST while chairing a session on the subject at New Delhi on June 12, 2015.



Organised under PetroFed’s series of Guest Lectures and Thought Leadership Programmes, the lecture was on ‘Options for Revenue Neutral GST for Oil & Gas’ by Prof. Sacchidananda Mukherjee, Associate Professor, National Institute of Public Finance and Policy (NIPFP). In a detailed presentation Prof. Mukherjee brought out the fact that there were alternatives for inclusion of Oil & Gas in the scheme of GST from the beginning since their elimination would lead to cascading of taxes which could be detrimental for competitiveness of Indian industries in international market.



Non availability or partial availability of input tax credit will result in stranded costs for some sectors and the costs may be spread across all sectors of the economy through sectoral inter-linkages.



Prof. Mukherjee concluded by highlighting that there is little ground for separating out petroleum products for special treatment by keeping them out of the base of GST.



The subject being of great importance to the sector witnessed intense floor participation.



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