BUDGET WISHLIST: Oil and gas sector

, Indian Oil Corporation

"We are hoping for a reduction in excise duty on petro products in the Budget. Rationalisation of taxes has been one of the lasting demands of the industry".

Chamber Speak

Assocham
Cross-country pipelines should be treated as infrastructure. Crude oil product and gas pipelines, storage terminals and other related facilities for transportation and storage should be classified as infrastructure facility.

Also, oil and gas exploration and production industry should be given infrastructure status.

Ficci
We want the Rangarajan Committee recommendations should be implemented in toto. A 10-year tax holiday should be granted to pipelines, storage terminals and other related facilities for transportation and storage of petroleum products.

Undertakings engaged in the commercial production or refining of mineral oil should be given the option of claiming tax holiday.

EXPERTSPEAK: Nityanand Gupta

Push for a unified market

A volatile crude oil market, an upsurge in upstream activities, a tight upstream services market, an upbeat refining sector, a gas market growing in confidence on the back of major discoveries and accompanied infrastructure development describe the current state of the oil and gas industry.

This market enthusiasm needs to be complemented by adequate budgetary provisions to realise India's vision of energy security.

Oil and gas is a sector of prime importance both for national policy makers and the country's exchequer. Industry and consumers, while highlighting the importance of a developed oil and gas market in a country's economic growth, demand attractive fiscal incentives.

Revenue planners, on the other hand, are reluctant to let go the significant tax collections from this sector. Every year the government, in its Budget declarations, does a balancing act of aligning these seemingly conflicting interests.

Although the Rangarajan Committee recommendations could not be considered in last year's Budget due to late submission of the report, the FM, in his speech, sought support of Parliament in evolving a consensus on the recommendations.

The shift from pure import parity to trade parity system of pricing fuels was one of the recommendations which has found acceptance. It needs to be seen whether the government this time considers the balance recommendations in totality, as desired by the committee.

A major committee recommendation is the proposal to integrate the domestic oil and gas market into a single unified national market with uniformity in rates of taxes through an all encompassing VAT covering both imports and local levies such as octroi etc.

The author is leader, oil & gas practice, PricewaterhouseCoopers