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Council thinks it’s not the right time to bring petrol, diesel under GST: Sitharaman

-45th GST Council members spoke very clearly they do not want Petrol-Diesel to be included in GST: Nirmala Sitharaman

-The food delivery app, cloud kitchens and food delivery platforms like Zomato and Swiggy will be charged 5 percent GST; Tarun Bajaj, revenue and GSTC secretary

By Kunwar Ashok S Rajput,

Lucknow: Clearing all the speculation regarding bringing auto fuel under the ambit of GST, finance minsiter Nirmala Sitharaman said on Friday that this is not the right time to bring petrol and diesel under GST. GST Council discussed the topic of inclusion of petrol and diesel under the tax structure after the Kerala High Court order. On the direction of court it was brought on to table but members spoke very clearly they do not want it to be included in GST, Minister Sitharaman said. This will be reported to the high court as the GST Council felt it was not the time to bring petroleum products under the GST. In June, the Kerala High Court, based on a writ petition, had asked the GST Council to decide on bringing petrol and diesel within the GST ambit.

The FM also announced that the GST rate on bio-diesel for blending with diesel (used by oil marketing companies) has been reduced from existing 12-percent to 5-percent. Finance minister chaired the first in-person GST Council meeting in nearly two years in Lucknow on September 17. The Council extended concessional tax rates on COVID-19 medicines, cut tax on cancer drugs and waived GST on import of highly expensive medicines for muscular atrophy. Concessional GST rates on COVID19 related medicines were announced earlier, applicable till September 30, the concessions have now been extended till Calendar December 31, 2021. GST rate on fortified rice kernels which can be used in schemes like Integrated Child Development Services Scheme read Mid-day meal has been reduced from 18 percent to 5 percent, Finance Minister informed to the media after GSTCM.


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This was the first physical meeting since the COVID-19 pandemic broke out in March 2020, the 45th meeting of the Goods and Service Tax Council in Lucknow presided over by Union Finance Minister Nirmala Sitharaman. The 44th GST Council meeting took place via video conferencing on June 12 wherein some key issues were addressed and GST rates on several items crucial in the fight against the pandemic were slashed till September 30. 3-days inaugural-meet goes on the expected lines, the GST Council also decided to charge services by cloud kitchens and food delivery platforms like Zomato and Swiggy a 5 percent GST. The food delivery app will have to collect and deposit 5 per cent GST with the government, in place of restaurants, for deliveries made by them, the finance minister said. There is no extra tax and there is no new tax, revenue secretary Tarun Bajaj added. To curb the tax evasion, GST Council has proposed to make the food delivery apps like Zomato Swiggy liable to pay GST at 5 per cent as deemed suppliers of restaurant services with effect from January 1, 2022.

In practice, a or b person order food from aggregator and restaurant is paying taxes, whereas, we found that some restaurants were not paying taxes. Now we are saying if you order via app, the app will collect tax from consumer and pay to the revenue authorities instead of the restaurant doing this, there is no new tax, Revenue Secreatry and Secretary to the GST Council Tarun Bajaj clarified. The fitment panel suggested that the changes come into effect from January 1, 2022, and food delivery aggregators be allowed to make suitable changes in their software.

As per the estimates of the fitment committee of the GST Council, Rs 2,000 crore in 2019-20 and 2020-21 were evaded by these firms and the panel recommended food aggregators be classified as e-commerce operators and pay GST on behalf of the restaurants concerned. By doing so, the Government should be cautious of not adding to the burden by creating another layer of input tax credit blockage already suffered by this sector, said council event organizer partner.

On rate rationalise issue, Finance Minister said that two groups of ministers will be constituted to look into certain changes in the GST regime. One group will be looking at rate rationalisation issues and submit a report in two months. The second group will look into related issues of e-way bills, fastags, technology, compliance, composition schemes and they, too, will submit a report in 2 months, minister said. GST Council has decided on Friday that GST rate changes will be done to correct Inverted duty structure anomalies in footwear and textile sectors, to be implemented from January 1, 2022. This was as discussed earlier by Council, then deferred, correction was done only for mobile phones, FM added.

Besides Union Finance Minister Nirmala Sitharaman and Union Minister of State for Finance Pankaj Chaudhary, Arunachal Pradesh Deputy Chief Minister Chowna Main, Bihar Deputy Chief Minister Raj Kishore Prasad, Delhi Deputy Chief Minister Manish Sisodia, Gujarat Deputy Chief Minister Nitin Bhai Patel, Haryana Deputy Chief Minister Dushyant Chautala, Manipur Deputy Chief Minister Yumnam Joy Kumar Singh and Tripura Deputy Chief Minister Jishnu Dev Verma and various state Institution-Finance ministers participated at the GST Council meeting,Suresh Khanna, Finance Minister of UP said.



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