The debate to get ATF and Natural Gas under GST has yet again picked up pace, with the oil ministry pushing the proposal as part of its 100-day action plan, the finance ministry continues to remain cautious about the move.

According to sources, “the proposal of oil ministry is yet to be sent to the GST council nominated fitment committee for its consideration.”

Important to note is that under the GST regime, any proposal to include any item, commodity or service under GST, the proposal is pushed by the line ministry or the industry. It is then shared by the Finance Ministry to the GST Council. To set a rate, the GST Council shares it with the fitment committee and the law committee to assess the proposal, seek responses from the committee members, to understand the scope of the proposal in terms of rate, revenues, impact on states etc. Post this analysis, the fitment committee makes a recommendation to the council for their discussion and decision.

Given this process, sources say that “the proposal has not yet been sent to the committees under the GST Council regime. Officials of the Finance Ministry and Petroleum Ministry met to discuss the matter but no commitment has been given by the officials, given that the proposal has been time and again deferred by the council.”

In the past, this proposal has been pushed for the consideration of the GST Council. It was discussed at length, in the 45th GST Council meeting. The council had reiterated that petroleum projects are already under the GST ambit, but no rate has been assigned to the category or to the various petroleum products. The council decided that it could start discussing the proposal as and when it felt appropriate.

Sources indicated that “states are still unwilling to give away their share of revenues which they are earning from petroleum products. Thus, it might be difficult to convince states, even the ones which are ruled by BJP.”

Whether the council decides to bite this bullet or not, is to be seen.

Source: CNBC TV 18