GST Council Meeting June 22: ATF & Natural Gas in GST

The GST fitment committee is expected to meet before the upcoming GST Council session on June 22, focusing on the Oil Ministry’s proposal to bring ATF and Natural Gas under GST, CNBC-TV18 reports.

Sources familiar with the matter suggest the committee may also address clarifications regarding Input Tax Credit (ITC) claims and rate rationalization. There is consideration of placing ATF under a 5 percent GST slab and assessing proposals to tax Natural Gas at 12 or 18 percent.

Earlier reports from Moneycontrol, requesting anonymity, indicate that immediate rationalization of the current four GST slabs might be delayed due to concerns about its impact on lower-income groups.

The 53rd GST Council meeting on June 22 may clarify various issues that have been debated recently, including scrutiny of foreign airlines and shipping lines by the DGGI for GST compliance, and ITC applicability on telecom services and spectrum.

The tax department has issued notices to foreign airlines like Finnair, KLM Royal Dutch Airlines, Qatar Airways, Virgin Atlantic, Etihad, Emirates, Saudi Airlines, Air Arabia, Oman Air, Kuwait Airways, and British Airways, as well as several shipping lines, regarding GST on imported services.

The Council may also discuss improving Ease of Doing Business for global companies with branches in India and addressing the inverted duty structure under GST. Moneycontrol previously reported government efforts to ease related party transaction rules for foreign companies, possibly within 100 days after elections, allowing deferral of GST payment on imported services until service disbursement.

Another anticipated discussion is the review of GST on online gaming, highlighted by CNBC-TV18, with companies like Gameskraft and Delta Corp facing retrospective tax notices. These companies seek GST calculation based on gross gaming revenue rather than the face value of bets.

Reports from April 2024 suggested that the GST Council might directly review GST on online gaming, bypassing the fitment committee.

This meeting marks the first GST Council session since the 2024 Lok Sabha elections, with the previous one held on October 7, 2023. The Council may also consider a roadmap for simplifying rules and enhancing tax compliance.

Gross GST collections for the first two months of FY25 amount to Rs 3.83 lakh crore, showing an 11.3 percent year-on-year increase.