Bringing petrol, diesel under GST will lower prices: Devendra Fadnavis

Ann Santiago
May 27, 2018

Other cities, like Delhi, Jaipur, Guwahati, Bhopal, Jaipur, Chennai and others have also witnessed a continuous increase in fuel prices.

India has the highest retail prices of petrol and diesel among South Asian nations as taxes account for about 40-50 percent of pump prices. "Bonanza to Central government is ₹25 on every litre of petrol". It is likely that the government may ask Indian Oil Corporation, Hindustan Petroleum Corporation and Bharat Petroleum Corporation to freeze prices as a temporary arrangement.

The revisions continued till just before the general elections in 2004 when oil companies went slow and after a Congress-led UPA came to power the entire process was reviewed as the worldwide oil prices started moving up.

But the economic experts say that it is not possible.The Narendra Modi government has a fiscal deficit target of 3.2% for the fiscal year 2018-19. Until June 2015, the government subsidised India's oil refiners and marketers such as Indian Oil, HPCL and BPCL.

Opposition leaders have criticised the government for failing to rein in rising fuel prices, a politically-sensitive issue in one of the world's biggest economies.

Diesel prices across metros on May 23
Diesel prices across metros on May 23

The finance ministry has provided data on levies on petrol and diesel to the PMO.

The Prime Minister's Office (PMO) will take a final call on a cut in the excise duty on petrol and diesel, according to senior officials, with surging fuel prices creating ripples among consumers and politicians alike.

The government had between November 2014 and January 2016 raised the excise duty on petrol by Rs 11.77 a litre and on diesel by Rs 13.47 per litre to take away gains arising from plummeting global crude prices. "Though VAT on fuel in many states is higher than Gujarat, these states have not reduced this tax like we had done", Patel, who also handles Finance portfolio, said. For obvious reasons, the government kept fuel prices in check during the Karnataka assembly elections but prices have started shooting up as soon as the polls were over. "If it (petrol and diesel) can be brought under GST, rates will come down", he told reporters here.

"Maharashtra got in the four years of this central government what the state couldn't get in the past".

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