GAIL Could See Higher Transmission, Expense Cut On Natural Gas GST Inclusion

The potential inclusion of natural gas under the Goods and Services Tax could translate into lower expenses and increased transmission and trading volumes for GAIL India Ltd.

Recent commentaries by India's Oil Minister Hardeep Singh Puri and the Petroleum Ministry Secretary Pankaj Jain suggest that the government is reviving discussions of including natural gas under the GST regime.

While the inclusion could benefit customers the most, it could also impact GAIL's various business segments, according to Jefferies.

Natural gas integration in GST could potentially decrease natural gas prices by $0.8 to $0.8 per million metric British thermal unit, the brokerage said.

In fiscal 2023, various states in India imposed value-added taxes totaling Rs 20,000 crore on natural gas. Should these taxes be subsumed by the GST framework, Jefferies predicts a reduction in natural gas expenses.

Source : https://www.ndtvprofit.com/business/gail-could-see-higher-transmission-expense-cut-on-natural-gas-gst-inclusion