The power ministry is proposing renewable energy status to supplies meant for large hydro power projects to help keep power tariffs low under the proposed goods and services tax.
The ministry, which has sought zero rating or deemed export status for solar power projects on the grounds that levy of GST will substantially increase tariffs, now wants the same to be extended to supplies for under-construction hydropower projects. These supplies are currently exempt from excise duty or enjoy concessional value-added tax of 0-5% and a central sales tax at 2%.
Once GST comes into effect, all central and state taxes on goods and services will be replaced by a single levy of 18%, pushing up the cost of these supplies, which in turn will increase the cost of power. Read More…
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