Various companies in the power sector are contesting for inclusion of power, coal and natural gas in the goods & services tax (GST) regime. Its inclusion will result in subsuming multiple taxes and accordingly will reduce the cost of power projects and the per-unit tariff.
The reason for such a demand is also for brining a parity of taxes on domestic coal which is at 27-28 per cent . Whereas , domestic natural gas attracts taxes at 19 per cent.
It is estimated that a GST rate of 18 per cent for the power sector could result in 15-20 per cent reduction in retail tariff. Further, a cut in power cost will also improve payment by end-consumers and reduce incentive for theft and losses. This will also help distribution utilities to reduce their problem of revenue deficit as well.
It must be known that the government is planning to put electricity in the exempted category of goods under GST regime. But , if it is included in GST then it will reduce the burden of tax on the ultimate consumers of electricity. It is pertinent to note that the inclusion of power and coal sectors in GST regime will result in lowering of bulk power, retail tariff and support the Make In India initiative as well.
Disclaimer and Confirmation
As per the Rules of the Bar Council of India, advocates are not permitted to advertise. By clicking on the “I agree” button, the user agrees and acknowledges that:
This website simply explains as to how litigation is handled, the advice is rendered for various practice areas of the firm and how our law firm i.e. AMLEGALS does it differently;
That the user has visited the website of our law firm to know about AMLEGALS, White Papers, Legal articles, Legal updates & Case laws on various areas of law that are published by the Firm from time to time.
AMLEGALS assumes no liability for the interpretation and/or use of the information contained on this website, nor does it offer a warranty of any kind, either express or implied.
AMLEGALS is not liable for any consequences of any action taken by the user by relying on material/information provided on this website. Nothing mentioned on the website should be construed as legal advice. For more information on our working and to get in touch with the AMLEGALS team, please feel free to get in touch on email@example.com.