New Delhi, June 13th
As gasoline and diesel prices hit record highs, Oil Minister Dharmendra Pradhan on Sunday urged the Congress governments in Rajasthan and Maharashtra to cut sales tax if the party was concerned about the burden on fuel prices for the common man, but did not say whether BJP-ruled states like Madhya Pradesh and Karnataka, where gasoline has passed the Rs 100 mark, would do the same.
Gasoline and diesel have soared to all-time highs across the country after fuel prices rose by 5.72 rupees to 6.25 rupees per liter in less than six weeks. This is due to a combination of rising international oil prices and record high central and state taxes.
Speaking to reporters on the sidelines of an event organized to inaugurate the oxygen plant built by Indraprastha Gas Ltd at Maharaja Agrasen Hospital, he said that central and state governments need extra money from taxes on gasoline and diesel to cover the spending for pandemic control cover as development work.
“I accept fuel prices are driving consumers down,” he said, adding that the government is spending 1 lakh crore this year alone on providing free grain to the poor, along with money on vaccines and health infrastructure.
When asked about the repeated attacks by Congress leader Rahul Gandhi on the Modi government over skyrocketing fuel prices, Pradhan said, “Why is fuel expensive in Maharashtra, Rajasthan and Punjab (which are ruled by the party)?”
“If Rahul Gandhi is concerned that the poor are being hit by fuel prices, he should urge the prime ministers of the states ruled by Congress to cut taxes. He should ask (Maharashtra Minister) Uddhav Thackeray to lower taxes, ”he said.
However, he did not say whether BJP-ruled states such as Madhya Pradesh and Karnataka, where gasoline prices have also exceeded Rs 100 per liter due to local taxes, would follow suit.
Fuel prices vary from state to state, depending on the incidence of local taxes such as sales tax and freight charges. And because of this, seven states and union territories – Rajasthan, Madhya Pradesh, Maharashtra, Andhra Pradesh, Telangana, Karnataka, and Ladakh – sell gasoline over 100 rupees per liter.
Of these states, the Congress in Rajasthan is in power and a coalition partner with Shiv Sena and NCP in Maharashtra. BJP rules Madhya Pradesh and Karnataka and Ladakh are also under central rule. Andhra Pradesh has the YSR Congress in power while TRS rules in Telangana.
Rajasthan has the highest sales tax (sales tax) on gasoline and diesel in the country, followed by Madhya Pradesh, Maharashtra, Andhra Pradesh, Telangana and Karnataka.
While international oil prices have surpassed USD 72 a barrel in anticipation of a recovery in demand for the vaccination program to be launched by various countries.
When tax rates plummeted to a two-decade low last year, the union government raised excise tax to a record high instead of passing the benefit on to consumers. When the Modi government took office in 2014, the excise tax on gasoline was 9.48 rupees per liter and on diesel 3.56 rupees per liter.
The excise tax on gasoline is now Rs 32.90 per liter, accounting for 34 percent of the retail sales price. The duty of Rs 31.80 per liter accounts for 36.5 percent of retail diesel prices.
The Sri Ganganagar district of Rajasthan, near the India-Pakistan border, was the first place in the country where gasoline hit the Rs 100 per liter mark in mid-February, and on Saturday it also received the award that diesel exceeded that psychological mark.
Gasoline in the city sells for Rs 107.22 per liter – the highest price in the country, and diesel comes in for Rs 100.05. Premium or additive gasoline in the city sells for 110.50 rupees per liter and diesel of the same quality at 103.72 rupees.
In Delhi, gasoline has hit an all-time high of 96.12 rupees per liter, while diesel is now at 86.98 rupees per liter.
Mumbai became the first subway in the country on May 29 to sell gasoline for over 100 rupees per liter. Gasoline now costs 102.30 rupees per liter in the city and diesel comes for 94.39 rupees.
Gasoline and diesel prices have been hiked 23 times since May 4, when state oil companies ended an 18-day hiatus in price revision they observed during parliamentary elections in states like West Bengal.
With 23 increases, the price of gasoline increased by Rs 5.72 per liter and the price of diesel increased by Rs. 6.25 per liter. PTI