Following the central government, the Mahavikas Aghadi state government on Sunday also lowered the fuel tax, bringing relief to the people. However, Devendra Fadnavis, leader of the opposition in the state, criticized the state government’s decision to reduce the tariff. In Nashik, as journalists raised questions about the state’s fee cut, Fadnavis took aim at the Mahavikas Aghadi government.
What exactly has the state government done?
The central government had on Saturday cut excise duties on gasoline by Rs 8 and diesel by Rs 6. Union Finance Minister Nirmala Sitharaman had suggested that state governments should also cut value added tax. Consequently, the state government took this step. The reduction of value added tax on fuel will put an annual burden of around Rs 2,500 crore on Maharashtra’s coffers.
How much is the tax now?
The Center has decided to reduce excise duties due to rising fuel prices. After that, in the context of tax cuts in some states, the state government also provided relief to citizens by giving the same amount. Currently, the state tax on gasoline is Rs 32.55 per litre. Now it will be reduced by Rs 2 08 paise. The state duty on diesel was Rs 22.37 paise. It has been reduced by 1 rupee 44 paise. Exactly how much cheaper the state’s fuel will be because of this reduction will be known only after oil companies set rates on Monday, the Gasoline-Diesel Sellers Association said.
There was no other option than the tax deduction
The gas tax in the state was higher than the central rate. Deputy Chief Minister and Finance Minister Ajit Pawar had promised to reduce the tax. However, as the Center reduced the petrol tax by Rs 8 and the diesel tax by Rs 6, the MVD government had no choice but to cut the taxes. Otherwise, opponents would have had room to criticize. BJP-ruled Karnataka had earlier cut fuel taxes.
What did Fadnavis say?
When asked about this reduction, Fadnavis said, “I think the common man has been outwitted by the state government.” Speaking further, “It is a joke to reduce fuel prices by Rs 1.5 and Rs 2 respectively. Because if you look, so far all the states have reduced the tariffs from Rs 7 to Rs 15. Maharashtra is the richest state of the country. Maharashtra alone accounts for 15 percent of the country’s GDP,” Fadnavis said.
“The central government has accepted a loss of Rs 2 lakh 20 billion rupees and we are saying that it is causing a loss of Rs 2,500 crore. In fact, the state government should have cut at least 10 per cent of the cut of central government tariffs at this location,” Fadnavis said.
If only a little magnanimity of mind were shown
While other state governments are cutting Rs 7-10 on fuel, advanced states like Maharashtra have mocked the common man by cutting Rs 1.5-2 per litre.
Prime Minister Narendra Modi, in a televised meeting with top state ministers on April 27, suggested that states not governed by the BJP cut fuel taxes. However, at the time, the state government had avoided tax cuts. From that, BJP had targeted the government of Mahavikas Aghadi.
BJP-ruled states cut rates
The Center had raised the excise tax on fuel last November. The tax increase was criticized because fuel prices increased in the international market. The Center had called on the states to reduce the value added tax so that citizens are not affected. Consequently, the BJP-ruled states had lowered fuel prices. However, states not governed by the BJP avoided tax cuts. From that, Prime Minister Modi even shrugged off states not governed by the BJP.
‘The entire burden of taxes is in the center’
Excise duties on gasoline and diesel have been reduced to the ‘Road and Infrastructure Tax’ (RIC) which applies to petroleum products. The entire burden of cutting taxes will fall on the central government, Finance Minister Nirmala Sitharaman said on Sunday. She also pointed out that there was no need for states to worry as the basic excise tax on petroleum products payable to states had not been collected.