Petrol, Diesel to Remain Out of GST Ambit

The Goods and Service Tax (GST) Council Friday deferred the inclusion of petroleum products within the ambit of the levy, extended the compensation cuss until March 2026 to repay money borrowed to compensate states, and mandated food delivery apps such as Zomato and Swiggy to pay GST on behalf of restaurants they service.

In its first physical meeting after the pandemic broke out, the council offered relief on drugs, including those for cancer and Covid. However, it didn’t extend the period of compensation to states in lieu of the revenue loss due to implementation of GST beyond 2022. Several states had demanded an extension. The meeting was held in Lucknow.

In a relief to the business process outsourcing (BPO) sector, the council also approved a clarification to define what constitutes exports to ensure that call centers don’t face GST.

“Giving of compensation at 14% was for five years and that ends in July 2022,” finance minister Nirmala Sitharaman said after the council meeting. She said the compensation cuss collected from July 2022 till March 2026 will be used solely for repayment of back-to-back loans given to states, totaling Rs.2.69 lakh crore.  S-ET

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