Moneycontrol

Budget 2023Budget 2023

PARTNERS

  • Tata AIA Life Insurance
  • Hafele
  • Motilal Oswal
Register Now : Nifty Banker 3.0 | India's First Retail Index Traders Online Conference.
Budget 2023
Budget 2023
you are here: HomeNewsPolitics

Centre's taxes on fuel prices continue to be exorbitant: Tamil Nadu FM responds to comments made by PM Modi

Minister for Finance and Human Resources Management Palanivel Thiaga Rajan said the taxes on fuel prices levied by the Centre continue to be "exorbitant" and it was neither 'fair' nor 'feasible' for the State to further reduce it.

April 28, 2022 / 12:51 PM IST
India is 80% dependent on imports for meeting its oil needs and so retail rates adjust according to the global movement in crude prices. (Representative Image)

India is 80% dependent on imports for meeting its oil needs and so retail rates adjust according to the global movement in crude prices. (Representative Image)

The Tamil Nadu government on Thursday hit back at the Centre and reiterated its earlier demand to reduce the cess and surcharges levied on fuel prices and merge them with basic tax rates so that states receive their rightful share from the union taxes. Minister for Finance and Human Resources Management Palanivel Thiaga Rajan said the taxes on fuel prices levied by the Centre continue to be "exorbitant" and it was neither 'fair' nor 'feasible' for the State to further reduce it.

The remarks by the Minister were in response to the comments made by Prime Minister Narendra Modi on Wednesday that the Centre reduced excise duty to lower the burden of fuel prices on November 2021, while some states reduced it, some did not provide that benefit to the people. Modi in his meeting with Chief Ministers had said Maharashtra, West Bengal, Telangana, Andhra Pradesh, Kerala, Jharkhand and Tamil Nadu did not heed to its request and public continue to be burdened.

Rajan, in a statement on Thursday, referred to the Tamil Nadu government's cut on the Value Added Tax in August 2021 resulted a relief of Rs 3 per litre soon after his party assumed office in May 2021. Continuing his attack on the Centre that the levies on petrol increased substantially in the past seven years, Rajan said, though the revenue to the Union government increased 'manifold' there was no matching increase in the revenues to the states. "This is because the Union Government has increased the cess and surcharge on petrol and diesel while reducing the basic excise duty that is shareable with the states."

The Minister said, in August 2014 the basic price of petrol was Rs 48.55 per litre while diesel it was Rs 47.27 per litre. The Central government taxes were Rs 9.48 per litre on petrol and Rs 3.57 per litre on diesel. The state government taxes were at Rs 15.67 per litre on petrol and Rs 10.25 per litre on diesel, he said. Following the reduction of taxes by the Centre in November 2021 at Rs 5 per litre on petrol and Rs 10 per litre on diesel, the union government still levies an additional tax of Rs 18.42 per litre for petrol and Rs 18.23 per litre on diesel, he pointed out.