CBEC Press Release dt 11.10.2017 on — Petroleum & Oil Sector

                                                          PRESS RELEASE
11th October 2017
On Petroleum & Oil Sector
To reduce the cascading of taxes arising on account of non-inclusion of
petrol, diesel, ATF, natural gas and crude oil in GST and to incentivise
investments in the E&P (exploration and production) sector and downstream
sector, the GST Council in its 22nd meeting held on 6th October, 2017 has made
the following recommendations for GST rate structure for specified goods and
services:
i. Offshore works contract services and associated services relating to oil
and gas exploration and production in the offshore areas beyond 12
nautical miles shall attract GST of 12%;
ii. Transportation of natural gas through pipeline will attract GST of 5%
without input tax credits (ITC) or 12% with full ITC;
iii. Import of rigs and ancillary goods imported under lease will be
exempted from IGST, subject to payment of appropriate IGST on the
supply/import of such lease service and fulfilment of other specified
conditions.
2. Further, GST rate on bunker fuel is being reduced to 5%, both for foreign
going vessels and coastal vessels.
3. Notifications to give effect to the above proposals will be issued shortly.
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