NEW DELHI: The Centre has virtually ruled out including petroleum products within the ambit of GST immediately, turning down repeated demands from the aviation sector and oil companies.
Even the petroleum ministry had taken up cudgels for the sector that has been arguing that benefit of GST is not accruing to them as companies cannot claim input tax credit. The credit can only be claimed if the entire chain from inputs to the final product pays GST.
The Centre is, however, of the view that the change in the regime may not pass muster with the states, which want to retain flexibility in taxing a few items that they have control over. Stamp duty on real estate, excise on alcohol and petroleum products are among the handful of items on which states still have control after the introduction of GST.
