Budget 2012: Oil & gas sector witnessed specific emphasis - Ernst & Young
The Excise duty structure for most petroleum products has been rationalized, with an ad valorem levy of duty at the rate of 14% on most products.
Updated:
By Saloni Roy
Tax Partner, Ernst & Young
The Oil & Gas sector witnessed specific emphasis in this year’s Budget. The Excise duty structure for most petroleum products has been rationalized, with an ad valorem levy of duty at the rate of 14% on most products, while diesel, light diesel oil etc continue to have a specific levy per litre in addition to the ad valorem levy.
Budget at ET: Budget 2012 | Union Budget | Live Union Budget Blog | Railway Budget | Budget News | Economic Survey of India
An exemption from the whole of Basic Customs duty has been provided for Steam Coal used in power generation, while the Additional Customs duty for the same has been reduced to 1%. The thrust being given to power generation continues in the form of exemption from Basic Customs duty for Natural Gas and Liquefied Natural Gas when imported for power generation and distribution by a power generation plant.
This comes as an extension to the incentives provided by the Government to power generation plants.Other positive changes for the sector include exemption from Basic Customs duty on import of dredgers. Further, levy of cess on Additional Customs duty has been withdrawn for imported goods, resulting in duty savings for the entire industry.
Tax Partner, Ernst & Young
The Oil & Gas sector witnessed specific emphasis in this year’s Budget. The Excise duty structure for most petroleum products has been rationalized, with an ad valorem levy of duty at the rate of 14% on most products, while diesel, light diesel oil etc continue to have a specific levy per litre in addition to the ad valorem levy.
Budget at ET: Budget 2012 | Union Budget | Live Union Budget Blog | Railway Budget | Budget News | Economic Survey of India
An exemption from the whole of Basic Customs duty has been provided for Steam Coal used in power generation, while the Additional Customs duty for the same has been reduced to 1%. The thrust being given to power generation continues in the form of exemption from Basic Customs duty for Natural Gas and Liquefied Natural Gas when imported for power generation and distribution by a power generation plant.
This comes as an extension to the incentives provided by the Government to power generation plants.Other positive changes for the sector include exemption from Basic Customs duty on import of dredgers. Further, levy of cess on Additional Customs duty has been withdrawn for imported goods, resulting in duty savings for the entire industry.
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The negative for the Oil & Gas sector is the additional cess of Rs 2000 being imposed on Crude Oil under the Oil Industries Development Act, promising higher fuel prices and the long standing demand of the sector to include Natural Gas in the list of Good of Special Importance for the purposes of Sales Tax has not been given into.Start a SIP with as low as ₹500 with ET Money App!
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