Telecom tower firms to approach FM Arun Jaitley for adding diesel as an 'input' under model GST law

Telecom tower companies will shortly approach finance minister Arun Jaitley for inclusion of 'diesel' within the definition of 'inputs' under the model GST law to ensure it qualifies for Cenvat credit. They will also seek tweaks in the GST levy valuation mechanism and an overhaul of rules linked to availing of input tax credits.The telecom industry runs up an annual diesel bill of over Rs 10,000 crore, of which 70% is spent by the tower companies. "Tower companies are huge diesel buyers and the earlier rationale of denying Cenvat credit to diesel doesn't hold water anymore since it has been completely deregulated with no subsidy being provided," TR Dua, director general of Tower & Infrastructure Providers Association (TAIPA), told ET. Tower companies also want the finance ministry to continue the current process of claiming Cenvat credit purely on the basis of invoices furnished. In the GST regime, there is added requirement. The vendor's sales transaction details with the tower firm will first need to be uploaded on the government's IT backbone for GST to minimise abuse. The government is learnt to have suggested the change in the rules to have better control on input tax credit details from a verification perspective. "Valuation mechanism in the draft GST bill appears to have been framed in context of manufacturing sector and must not be applicable to the telecom industry per se, which is a services-oriented sector," said Dua. The article can be read at - http://economictimes.indiatimes.com/news/economy/policy/telecom-tower-firms-to-approach-fm-arun-jaitley-for-adding-diesel-as-an-input-under-model-gst-law/articleshow/53589679.cms