Tamil Nadu Minister Rules Out Tax Cuts On Fuel, Says PetrolPrices Were Slashed In Budget

"While the Union's taxes continue to be exorbitant, it is neither fair nor feasible for the State to further reduce taxes," Palanivel Thiaga Rajan said.

    Ruing out the possibility of further tax cuts on fuel, Tamil Nadu Finance Minister Palanivel Thiaga Rajan said that the state government had reduced tax on petrol by Rs 3 per litre in its budget, passed in August 2021. Turning down the Union government's request to further slash state taxes on diesel and petrol prices, Rajan termed the request as unreasonable and urged the Centre to reduce the levy of tax on fuel prices to rates that were prevailing in 2014.

"While the Union's taxes continue to be exorbitant, it is neither fair nor feasible for the State to further reduce taxes. The sole, simple and fair approach to improve the situation for all is for the Union to reduce the levy of taxes on petrol and diesel to the rates prevailing in 2014. Such a move will automatically reduce states' taxation (as almost all States follow ad-valorem)," he stated in an official press release. 

Ruing out the possibility of further tax cuts on fuel, Tamil Nadu Finance Minister Palanivel Thiaga Rajan said that the state government had reduced tax on petrol by Rs 3 per litre in its budget, passed in August 2021. Turning down the Union government's request to further slash state taxes on diesel and petrol prices, Rajan termed the request as unreasonable and urged the Centre to reduce the levy of tax on fuel prices to rates that were prevailing in 2014.

"While the Union's taxes continue to be exorbitant, it is neither fair nor feasible for the State to further reduce taxes. The sole, simple and fair approach to improve the situation for all is for the Union to reduce the levy of taxes on petrol and diesel to the rates prevailing in 2014. Such a move will automatically reduce states' taxation (as almost all States follow ad-valorem)," he stated in an official press release. 

Further, the state finance minister enumerated that while buying a litre of petrol and diesel, there are many factors that compound the final pump price- basic price, Union excise duty, cesses and surcharges on the basic price, transportation costs, state government taxes and dealer's Commission. He also recalled that on August 1, 2014, the basic price of petrol and diesel and the global import prices adhered to the current import prices.

"The basic price was Rs 48.55 per litre for petrol Rs 47.27 per litre for diesel. On November 4, the basic price of petrol was Rs 48.36 per litre while that of diesel was Rs 49.69 per litre. On August 1, 2014, the Union Government taxes were Rs 9.48 per litre on petrol and Rs 3.57 per litre on diesel. At that time, the State Government taxes were Rs 15.47 per litre on petrol and Rs 10.23 per litre on diesel," Rajan noted. 

"So, when compared to 2014, the Union Government still levies an additional tax of Rs 18.42 per litre for petrol and Rs 18.23 per litre for diesel," he added. 

At present, the petrol price in Chennai stands at Rs 101.40 and the diesel price is Rs 91.43.

 

Media: REPUBLICWORLD.COM