"All Chief Ministers On Test Now", Says Arun Jaitley, Cutting Fuel Price
04 October, 2018, 19:15 | Author: Frank Williams
While some states like Andhra Pradesh and Karnataka cut the fuel prices weeks ago by announcing a cut to the Value-Added Tax charged by the states, Tamil Nadu, Telangana and Kerala had maintained that it was up to the Central government to reduce the prices.
Indian Oil Corporation (IOC), the country's largest fuel retailer, hiked the price of diesel and petrol by 21 paise and 14 paise respectively on Thursday.
Bihar Deputy Chief Minister Sushil Kumar Modi said his government has not received any letter from Jaitley on the matter, ANI reported. In an oblique reference to the opposition parties, Jaitley said it will be a test for those states whose leaders were only tweeting and indulging in lip sympathy.
Jharkhand Government has also chose to give an additional relief of Rs 2.5/litre on diesel in the state, said Raghubir Das.
Since the government came to power in May 2014, it has used tax increases on petrol and diesel prices to raise funds for welfare programmes. Rupani also announced that petrol and diesel would be cheaper by Rs 5 cheaper in Gujarat.
Meanwhile, Maharashtra, Gujarat Government also chose to give additional relief of ₹2.5/litre on Petrol to give total benefit of ₹5/litre in the State. "Then we will also step in", Mr Issac said.
"Finance Minister Sh @arunjaitley Ji has announced Rs.2.5 cuts in petrol & diesel prices, reciprocating positively to FM's announcement, the Govt Of Gujarat has also chose to reduce Rs.2.50 on both petrol & diesel".
The new fuel prices would be effective in the state from this midnight, an official spokesman said.
Announcing the cut in Delhi, finance minister Jaitley said the Centre would reduce the excise duty by Rs 1.5 per litre while oil marketing companies would absorb the rest Re 1 per litre.
Price cut in states like Gujarat and Maharashtra would be Rs 5 after they matched the announcement with a similar reduction in local sales tax or VAT rates.
By lowering duties, the Narendra Modi government is borrowing a page from the rulebook of past governments that have lowered levies whenever global oil prices shot up.
Brent oil on Wednesday crossed $86 per barrel, which is the highest in the last four years, and rising interest rates in the U.S. have a significant impact across global markets, said Jaitley.
The fuel prices had been going up every day for last few weeks, burning a hole in people's pockets. Neither the centre nor the states have the bandwidth to make any steep cut in excise duties and sales tax due to limited fiscal space available in an election year. As on October 4, petrol prices stood at Rs 91.34 per litre in Mumbai.
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