Home / News / India /  Petrol, diesel under GST: 'Not possible in next 8-10 yrs,' Sushil Modi explains

Bringing petrol and diesel under the Goods and Services Tax (GST) regime is not possible for the next 8-10 years, veteran Bharatiya Janata Party leader Sushil Kumar Modi said on Wednesday.

While speaking at the Parliament, Sushil Modi asked, "Repeatedly, the issue of putting petrol and diesel in the GST regime is being raked up. I have been associated with the GST for a long time, I want to know from the House, that if petrol and diesel are put under the GST regime, who will compensate for the loss of revenue of over 2 lakh crore to states."

"I want to tell this House that it is not possible to put petrol and diesel under the GST in the next eight to 10 years, as no state is ready to lose 2 lakh crore revenue, be it the Congress or any other government," he further mentioned.

Centre and states together earn over 5 lakh crore annually from tax on petroleum products. "It is easy to make statements outside, but you need courage as displayed by Narendra Modi to implement the GST. Had there been any other prime minister, he would not have been able to implement the GST," Sushil Modi told the House.

If petroleum products are brought under the GST, 28% tax would be collected on them as that is the highest slab in the tax regime, he explained. "At present, 60% tax is being collected on petroleum products. This would result in a shortfall of 2 lakh crore to 2.5 lakh crore (to both the Centre and states). If we collect 28% tax on petroleum products, then only 14 would be collected (per litre) against 60 at present," he pointed out.

"It is said that the tax collected on petrol, diesel goes into the pocket of the government. There is no separate pocket of the government. From where will the money come for providing electricity and tap water to all households. The spending of tax collection on the welfare of the country is being challenged," the BJP leader lamented.

Finance minister Nirmala Sitharaman had on Tuesday said in Lok Sabha that she would be "glad" to discuss the suggestion of bringing petrol and diesel under the ambit of the GST at the next meeting of the council.

On Wednesday, petrol price was cut by 18 paise per litre and diesel by 17 paise per litre. In Delhi, Petrol is available at 90.99 per litre and diesel now comes for 81.30 a litre.

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