‘The state governments should answer about high fuel prices’ asserted Nirmala Sitharaman

People should ask their own state governments about high fuel prices, Finance Minister Nirmala Sitharaman said at a press conference on Monday night, asserting that the central government had appealed to states to reduce Value Added Tax (VAT) to further bring down rates after slashing excise duty on petrol and diesel. As a result, state administrations must explain why fuel prices have not decreased.

Ms. Sitharaman was speaking to the media after meeting with Chief Ministers and Finance Ministers from around the country to discuss ways to improve the country’s investment climate “in the aftermath of strong recovery” and the “opportunity afforded by a shift in geopolitical realities post-pandemic.”

“Petrol and diesel cannot be included in the Goods and Services Tax (GST) until the GST Council decides the rate for their inclusion,” added the Finance Minister.

During Diwali, the Centre cut excise duty on petrol and diesel by 5 and 10 per liter, respectively, in response to widespread complaints about spiraling fuel costs. Several states had lowered their VAT rates in order to bring fuel prices down. Some states, on the other hand, have asked the federal government to lower excise taxes even more.      

Even after the Centre lowered the prices of petrol and diesel, opposition parties criticized the government on numerous occasions, questioning its intentions and overall attitude on dealing with fuel prices in the long term.

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