Political News: Opposition parties demand more cuts in fuel tax from Centre

Opposition parties on Friday insisted that the Centre’s Diwali-eve reduction of excise duty on petrol and diesel was “too little” and demanded more cuts, even as the governments in the states ruled by these parties are facing a mind-game after their BJP counterparts slashed VAT and asked them to do the same.

On Friday, Kerala’s LDF government ruled out cutting VAT on fuel prices, while Congress-ruled states are still holding their taxes. But these governments replicating the BJP-ruled states can’t be ruled out, as politics over fuel tax has now shifted with BJP workers seeking relief in opposition-ruled states. The opposition claimed that the Centre was forced to cut the central tax only because of the setback the BJP faced in byelections.

Interestingly, the Congress leaders of Kerala and state BJP functionaries are together in targeting the LDF regime for ruling out any cut in state taxes.

The Congress and other opposition parties argue that there was still a large scope for the Centre to roll back the “massive” excise duty on petrol and diesel to make it reasonable and realistic, and to provide the deserving relief to people. The Congress also pointed out that fuel price during the erstwhile UPA regime was far below.

Senior Congress leader Digvijaya Singh said: “If Modi ji really wants to give relief to the people by reducing the prices of petrol and diesel, then he should reduce the central excise duty as it was during the Congress regime in 2014… Maybe if he loses the elections in UP, then Modi ji will reduce the rate as it was in 2014.”

Congress spokesperson Randeep Surjewala questioned the credibility of Haryana’s BJP-led government’s claim about slashing VAT.

Kerala finance minister KN Rajagopal on Friday again asserted that the state regime would not reduce its share of tax. He accused the Centre of having collected more money than the state’s share of tax, by imposing a huge surcharge. He claimed the state too bore its share of concession when Centre slashed its taxes. “When the Centre reduced its tax by ₹10 per litre for diesel and ₹5 per litre for petrol, the reduction in price in the state was ₹12.30 per litre for diesel and ₹6.56 per litre for petrol. This means the additional reduction of ₹2.30 per litre for diesel and ₹1.56 for petrol was the state’s share,” Balagopal told media persons.

Rajasthan CM Ashok Gehlot on Thursday had taken a similar line. “With the reduction of excise duty by the Centre, the VAT of the states is automatically reduced in the same proportion, yet we demand that the Centre should reduce the excise duty more to reduce the inflation,” Gehlot tweeted.