Rajya Sabha MP Sasmit Patra met Finance Minister Nirmala Sitharaman to push for structured national discussions on bringing petrol and diesel under the Goods and Services Tax (GST) regime. Patra highlighted that the GST Council’s recommendation already paves the way for the eventual inclusion of petroleum products within the GST framework. He stressed the need for a fresh, consultative approach given the current economic conditions.
Patra pointed out that fuel prices have a direct impact on various sectors like inflation, transportation, agriculture, MSMEs, and household expenses nationwide. He emphasized that the existing differences in VAT structures among states undermine the goal of tax harmonization and market integration envisioned under GST. The MP from BJD also noted that Odisha, being a state with significant mining and industrial activities, could benefit from the gradual inclusion of petrol and diesel under GST, leading to reduced costs and enhanced competitiveness.
Advocating for a balanced approach, Patra acknowledged states’ concerns about revenue stability from petroleum taxes and proposed a phased framework for GST inclusion. He suggested measures like a structured GST slab system, transitional compensation for states, a limited revenue-protection cess, and a formula-based fiscal stabilization plan during the transition. Patra urged the Finance Minister to facilitate inclusive discussions with all states and consider forming a technical and fiscal working group to explore implementation models and create a national consensus on the gradual integration of petroleum products into the GST structure.
