The State government cannot afford to slash the sales tax on fuel, Finance Minister K.N. Balagopal said on Monday, holding the Centre accountable for the hike in fuel prices.
The State can scarcely be expected to do so when it is already being denied its rightful share in taxes by the Centre, Mr. Balagopal said.
Kerala receives at present ₹26.34 as tax on a litre of petrol, while the Centre gets ₹27.90. In the case of diesel it is ₹19.14 and ₹21.80 respectively.
Other levies
The Central government has been resorting to levies, such as cess and special additional excise duty, on fuel, Mr. Balagopal said, adding that ignoring this fact and questioning the proportional revenue due to the State alone is not correct. The Centre should be held to task for burdening the public through such levies.
Mr. Balagopal reiterated that the State is going to face a shortfall of ₹17,000 crore in the current financial year due to the discontinuation of the Goods and Services Tax (GST) compensation beyond June and cuts in other assistance. The flawed policies of the Centre is pushing the country into a grave financial scenario, he alleged, adding that the fuel price has triggered a countrywide rise in the prices of essential commodities. It is difficult to grasp the rationale behind the hike.
When the prices were determined by the government and crude prices stood at $118, petrol had cost ₹60 a litre. Now when the crude prices are at $115, petrol costs ₹114 a litre. The Kerala State Road Transport Corporation is forced to shell out more for diesel. The price of commercial LPG cylinders has touched ₹2,256. The fisheries sector is facing a crisis due to the hike in kerosene price, Mr. Balagopal said.
