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TOG NEWS

Bring Diesel & Petrol under GST to cut prices: Fadnavis
By TOG News Service
May 24, 2018

TOG News Service, MUMBAI, MAY 24, 2018: THE Chief Minister of Maharashtra, Mr Devendra Fadnavis, today suggested that after the unprecedented hike in fuel prices in recent days, the prices of Petrol and Diesel could be brought down if the two fuels were brought under the ambit of GST. As of now, Petrol and diesel prices are defined by international crude oil rates. He also stated that the state of Maharashtra had already given its consent to do so. In this regard, he stated that a task force is already working on reducing the fuel prices.

Mr Fadnavis acknowledged that the GST Council would also need to look into aspects such as loss of revenue, before taking a call on this issue. He added that although talks were ongoing with finance ministers of other states, they were yet to give their consent. He further mentioned that once Petrol & Diesel are brought under the ambit of GST, its threshold will change, because, right now, taxes upon taxes are levied which increases rates. GST would ensure a single tax.

It may be noted that in June last year, the Centre had junked the 15-year old practice of revising rates every fortnight and introduced daily revisions. Petrol and diesel prices were raised for the 11th day in succession today as the state-owned oil firms gradually passed on to the consumer the increased cost of international oil that had accumulated since a 19-day freeze was imposed just before Karnataka elections. Since the time the hiatus ended on May 14, rates have gone up by Rs 2.84/- a litre in case of petrol and Rs 2.60/- in diesel. Petrol costs Rs 77.47/- a litre in Delhi and diesel Rs 68.53/-. The central government levies Rs 19.48/- excise duty on a litre of petrol and Rs 15.33/- on diesel. State sales tax or VAT varies from state to state. Unlike excise duty, VAT is ad valorem and results in higher revenue for the state when rates move up.