India has reduced the goods and service tax (GST) on bunker fuel oil, known as bunker fuel, to 5 percent for all vessels, the government said on Wednesday, which should help the country`s fuel sellers compete with other lower-tax ports in Asia.
India`s nationwide GST taxed bunker fuel sales at 18 percent when it was implemented on July 1. The GST replaced state value-added taxes that were typically between zero and 5 percent.
India`s GST Council decided to reduce the tax on the bunker fuel sales after an Oct. 6 meeting where it recommended assessing GST rates for the bunker fuel sales, natural gas transportation and for offshore oil and gas field services, according to the statement the Council posted on Twitter.
"This would provide limited relief to the bunker fuel sellers that had seen their market shifting to Colombo," a trade source said. Like Asian bunkering hubs in Singapore and Fujairah, Sri Lanka levies no taxes on bunker fuel oil.
For the offshore oil and gas field services, the Council set the GST at 12 percent. Natural gas transported through a pipeline will have a GST of 5 percent without so-called input tax credits, or 12 percent if the tax credits are included, according to the statement.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)