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Opposition presses for respite from high fuel prices in Ahmedabad

In Ahmedabad, while petrol price has risen to Rs 73.25/lt, diesel is at nearly Rs 65

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With fuel prices touching multi-year highs, the Opposition Congress is seeking to step up pressure on the BJP governments at the State and Centre for immediate steps to provide relief to citizens.

Because of increase in crude oil, petrol price in Ahmedabad rose to Rs 73.25 per litre, while diesel prices touched nearly Rs 65 a litre on Friday. In Mumbai, petrol price was at almost Rs 82 a litre, while diesel price was at an all-time high of Rs 69.54.

The Gujarat Congress said that petrol and diesel prices had risen sharply in the past few months, but the governments were busy filling their coffeRs rather than providing relief to people. Gujarat Congress spokespeRs on Manish Doshi said that since coming to power, the Narendra Modi government had increased excise duty on petrol by 133%, and that on diesel by 400%.

"This is an open loot," he said.

In October, two months before the assembly elections, the Vijay Rupani-led state government had lowered VAT on petrol and diesel by 4% when petrol prices had crossed Rs 70 per litre and diesel was at Rs 63. Prices of both fuels are now at even higher levels.

"The state government is still collecting 20% VAT on both petrol and diesel, besides levying 4% Cess. VAT should be lowered to provide some respite to citizens," Doshi demanded, adding that since fuel prices have gone up, the government's revenue would not be affected even if tax was lowered.

VAT on fuels is the largest source of revenue for the state. Figures tabled by the government during the budget session show that it collects close to Rs 1,000 crore as VAT on petrol and diesel every month. In 2016-17, VAT and Cess on the two fuels netted the state Rs 11,150 crore, while the revenue was close to Rs 9,600 crore in the fiRs t nine months of 2017-18.

The demand to bring petrol and diesel under the ambit of Goods and Services Tax (GST) have gained momentum due to rise in fuel prices. However, most states are unlikely to let of their biggest or major revenue source.

The Opposition pointed out that 15% VAT levied on Compressed Natural Gas (CNG) and Piped Natural Gas (PNG) in Gujarat was among the highest in all states and demanded a reduction. Incidentally, gas is also a major contributor to the state's exchequer, and its prices were hiked by as much as 4-8% earlier this week.

According to official figures, the government collected Rs 1,365 crore as VAT on CNG and PNG in 2016-17, and Rs 800 crore in the fiRs t three quarteRs of 2017-18.

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