The government has lowered Goods and Services Tax (GST) rate to 5% from 18% on ethanol meant for blending under the Ethanol Blended Petrol Programme.

Rameswar Teli, Union Minister of State for Petroleum and Natural Gas, said this in a written reply to a question in the Lok Sabha last week. The decision was taken to promote ethanol blending, he added.

The procurement price of ethanol produced from sugarcane-based feedstocks like heavy molasses, sugarcane juice, sugar, sugar syrup is fixed by the Government and from food grain-based feed stocks by Public Sector Oil Marketing Companies on an annual basis.