Economy

KPCC urges Centre to bring petroleum products under GST regime

KPCC urges Centre to bring petroleum products under GST regime”

Besides excise duty, the cost of crude oil and refining declined from ₹44.8 a litre to ₹26.7 a litre; oil marketing companies margin increased from ₹3.2 to ₹4.1 per litre; dealers' commission increased from ₹2 to ₹3.2 per litre; and Value-Added Tax was up from ₹11.9 to ₹15 per litre during 2014-17, Dr. Parameshwara told presspersons here.

The states stated that the move would be adversely impact their revenue, which has increased by nearly 50% for most states in the past three years on account of high value added (VAT) tax.

KPCC President G Parameshwara urged the Centre to bring petroleum products under GST ambit to check the steep hike in their prices due to increase in excise duty. The finance ministry sources said, "this is not possible in the near future".

According to official data, from 2015, the growth in the government's revenue from petroleum products has been 25%.

However, analysts said that neither the Centre nor states can afford to bring petroleum under the GST as it remains a source of significant revenues to both.

Chief minister Vasundhara Raje holds the finance portfolio in BJP-ruled Rajasthan.

In the current regime, the taxes on petrol and diesel are levied at close to 55%.

Following reports indicating a considerable drop in fuel costs if brought under the ambit of GST, the Karnataka Congress on Wednesday stepped up pressure on the Centre to bring both petrol and diesel under the new tax regime in the interest of the common man. Besides, the states also get a share from the excise kitty of the Centre. Almost half of this was central excise and another half the state taxes.

The Central government had expressed its inability to compensate such a huge amount during meetings of the empowered committee of the finance ministers on GST. Parameshwara alleged that the Centre has been "cheating the public" without giving appropriate answers for the hike, even though the crude oil prices globally have been plummeting. Last time, the petrol price crossed Rs 70 in Delhi or Rs 80 in Mumbai was when the worldwide crude price touched all time high of $ 115.



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