NEW DELHI: The GST regime will have no impact on cost of power and the lower tax on coal under the new dispensation will help discoms supply electricity at affordable rates, power, coal, renewable energy and mines minister Piyush Goyal said on Friday.
“The GST regime is designed to help bring down costs. As we have seen rates unfolding, we are a little more encouraged that GST will help the country reduce corruption and difficulties in operation and also bring a simpler tax regime,” Goyal said.
“The coal sector will also benefit with straightaway benefits to consumers because (higher) taxes used to be a burden on consumers of India. I am delighted that the GST Council has chosen to keep coal at 5% slab. I am sure that this will help discoms serve the poor and rural consumers with more affordable rates,” he said.
The tax slabs announced by the GST Council on Thursday had brought coal in the 5% bracket against 11.39% at present. On the performance of ministries under his watch, Goyal said there was no need for lower taxes to encourage clean energy, especially with grid-connected solar and wind power tariffs already falling to historic low. “The situation today is very different from the past. We can stand on our feet,” he said. On UPS and inverters being put in the higher tax bracket, Goyal said, “UPS and inverters are things of the past. Please don’t go back to the past.”
“This government has been able to maintain power prices at affordable levels and reduced it in most cases. NTPC has been able to bring down their variable cost by 20. We don’t need support of lower taxes to encourage renewable energy. By itself, it is good for the nation. It reduces pollution. It give discoms 25-year-long affordable power at prices which are even below grid (parity price).” Solar power tariff had last week dropped to all-time low of Rs 2.44 per unit, which is lower than the price of power from coal-fired units.