On Wednesday, PM Narendra Modi was addressing a Chief Ministers’ meeting to discuss the prevalent Covid-19 situation in the country. However, in his message that was televised live, the PM could be seen requesting some states to reduce VAT on petrol and diesel in order to give benefits to people.
#WATCH | Centre reduced the excise duty on fuel prices last November and also requested states to reduce tax. I am not criticizing anyone but request Maharashtra, West Bengal, Telangana, Andhra Pradesh, Kerala, Jharkhand, TN to reduce VAT now and give benefits to people: PM Modi pic.twitter.com/IPIuOJyTGK
— ANI (@ANI) April 27, 2022
Prime Minister Modi highlighted that the Central government had reduced the excise duty on fuel prices last year. In November, The Government of India announced that the excise duty on petrol will be reduced by Rs 5, and the excise duty on diesel will be cut by Rs 10 from November 4, 2021, on the eve of Diwali. At the same time, it also urged the state governments to reduce VAT on petrol and diesel to give relief to consumers.
Responding to the Prime Minister’s decision, some BJP-ruled states including Uttar Pradesh, Haryana, Gujarat, Goa, Assam, Karnataka and others followed suit after the Central government’s decision. This led to a collective dip in the price of petrol up to Rs 12 in these states. Alleging that this is a political gimmick ahead of assembly elections, the opposition ruled states refused to cut down the VAT upon fuels exacted by them, even declining the aspiration of the masses.
The Prime Minister now has again urged the states of Maharashtra, West Bengal, Telangana, Andhra Pradesh, Kerala, Jharkhand, Tamil Nadu to reduce VAT on petrol and diesel in the recently held meeting. He said, “I request the states to reduce the taxes and transfer the benefit to the people. Some of the states did the same upon the request of the Indian Government. However, in some states, people have not benefited from this because of the state governments’ decisions.”
He added, “Because of this, the petrol prices in some states are way higher than in others. This is not only an injustice to the people living in these states but it also affects the neighbouring states. I agree that those states which give up on the taxes have to bear the loss in revenue collection.” He gave an example of Karanataka and Gujarat saying, “Had the state of Karnataka not reduce the taxes on fuels, it would have collected Rs 5000 crore. If Gujarat had not done the same, it would have collected Rs. 3,500 to 4000 crore more.” He hinted at Maharashtra without taking the state’s name saying that the neighbouring state of Gujarat and Karnataka, in the meanwhile, collected an additional revenue of Rs 3.5 to 5.5 thousand crores without giving any benefits to the people.
“I am not pointing figures at anyone. I only request to think in the interests of your people,” PM Modi noted. “The states of Maharashtra, West Bengal, Telangana, Andhra Pradesh, Kerala, Jharkhand and Tamil Nadu have not reduced the taxes since November. I do not want to go into how much revenue these states earned. My only request is you should think in the interest of the nation,” PM Modi added.
BJP-ruled states selling petrol at lower prices
On April 4 recently, a 40 paisa hike in the petrol and diesel prices was announced owing to the crude oil price rise in the international market. However, the fuel price difference between BJP-ruled states and non-BJP ruled states, stands at least Rs 10, as of now. While until the first week of April, Gujarat and Haryana had consistently kept petrol under Rs 105, the non-BJP states are selling petrol at over Rs 110. It was also found that, non-BJP ruled states have a higher price for both petrol and diesel compared to the BJP-ruled ones.
