States will get to levy additional taxes on top of 28% GST on petrol, diesel: Modi
GST
Dated:- 29-6-2018
New Delhi, Jun 28 (PTI) – Petrol and diesel when brought under GST will involve a peak tax rate of 28 per cent plus states getting to levy some tax, keeping the retail rates at almost the same level as they are currently, Bihar Deputy Chief Minister Sushil Kumar Modi said today.
Modi, however, said it will take some time for states to get around to including petrol and diesel in the GST and the Council will take a final call on the timing.
If petrol, diesel are to be brought into GST, then states will be allowed the levy taxes on top of 28 per cent to prop up revenue. It will take some time to include petrol, diesel in GS
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uty on petrol and ₹ 15.33 per litre on diesel. On top of this, states levy Value Added Tax (VAT) – the lowest being in Andaman and Nicobar Islands where a 6 per cent sales tax is charged on both the fuel. Mumbai has the highest VAT of 39.12 per cent on petrol while Telangana levies the highest VAT of 26 per cent on diesel. Delhi charges a VAT of 27 per cent on petrol and 17.24 per cent on diesel.
The total tax incidence on petrol comes to 45-50 per cent and on diesel, it is 35-40 per cent.
Under GST, the total incidence of taxation on a particular goods or a service has been kept at the same level as the sum total of central and state levies existing pre-July 1, 2017. This was done by fitting them into one of the four GST tax slabs
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cut the tax just once in October last year by ₹ 2 a litre.
This led to its excise collections from petro goods more than doubling in last four years – from ₹ 99,184 crore in 2014-15 to ₹ 229,019 crore in 2017-18. States saw their VAT revenue from petro goods rise from ₹ 137,157 crore in 2014-15 to ₹ 184,091 crore in 2017-18.
GST subsumed more than a dozen central and state levies like excise duty, service tax and VAT when it was implemented from July 1, 2017.
However, its implementation on five petro products – petrol, diesel, natural gas, crude oil and ATF was deferred. This resulted in the industry losing on revenue as they were not able to offset GST tax they paid on input from those paid on the sale of
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