Union Minister pitches for GST on petrol prices again

Cheryl Sanders
April 4, 2018

Even as the Minister gave his alibi, fuel prices moved up further: petrol stood at Rs 73.83 per litre while diesel was priced at Rs 64.69 a litre in the national capital. "When there is a pricing issue, states should respond and cut VAT", Pradhan said. It is the highest since September 2014 when the rates had hit Rs 76.06 and diesel being highest ever at Rs 64.69 with the previous high of Rs 64.22 on Feb 7. Whenever there is a price hike in crude oil then there are some pinching prices in our market also.

In a related development, in reply to a query about whether the government is looking to review excise duty levied on petroleum and diesel, finance secretary Hasmukh Adhia said, "Not as of now", and added, "It is a demand". Requesting GST council to made changes, the minister said that I appeal to the council that these products should be included in the GST framework.

"India needs market pricing to provide oil to all", Pradhan said at an event organised to mark the launch of Euro-VI grade petrol and diesel in the national capital. "We are keeping a close eye on the developing worldwide oil scenario", Pradhan said.

State-owned oil firms, which have been since June past year revising auto fuel prices daily, today raised petrol prices by 10 paise and diesel rates by 11 paise per litre each in Delhi, as per an Indian Oil price notification.

The hike in fuel prices have again stoked fresh demands for the government to cut excise tax rates.

The highest rate of tax applicable to products under GST is 28%. Because of the reduction in excise duty, diesel prices had on 4 October, 2017 come down to Rs 56.89 per litre and petrol to Rs 68.38 per litre.

A supply cut by the Organization of the Petroleum Exporting Countries (Opec) and Russian Federation has led to a rally in global oil price. Noting that crude oil price had fallen from United States dollars 108 in May 2014 to USD 77 in April 2018, the former finance minister asked, "Why are petrol and diesel prices today higher than the prices in May 2014?"

The October 2017 excise duty cut cost the government Rs 26,000 crore in annual revenue and about Rs 13,000 crore during the remaining part of the current fiscal year.

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