” Injustice to the people ” – Rising petrol and diesel prices; Why don’t states including Tamil Nadu reduce taxes? – PM Modi Question | PM Takes Aim At Opposition-Ruled States On High Fuel Prices

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New Delhi: Opposition-ruled states, including Tamil Nadu and Maharashtra, have not reduced taxes on petrol and diesel, placing a heavy burden on the people of those states, Prime Minister Modi has said.

Prime Minister Narendra Modi today held consultations with state chief ministers as corona infections are on the rise in some states of the country. It was also attended by various state chief ministers. The consultation meeting, which was held through video conferencing, discussed the issue of corona infection and petrol-diesel price hike.

Speaking at the meeting, Prime Minister Modi said:

I urge the states to reduce the VAT on petrol and diesel prices and that the reduction of VAT will help the federal philosophy. I am not criticizing anyone, I am just making a request.

Let me give you a small example. The central government last November reduced excise duty on petrol and diesel to reduce the burden on citizens. We also asked the states to reduce their taxes and pass on the benefits to the people.

While some states have reduced taxes, some states have not. Thus giving no benefit to the people. As a result, petrol and diesel prices in these states continue to rise. In a way it not only causes injustice to the people of this state but also affects the neighboring states.

For some reason states like Maharashtra, West Bengal, Telangana, Andhra Pradesh, Tamil Nadu, Kerala and Jharkhand have not agreed to reduce VAT on fuel. Thus the burden of high prices continues to be borne by the citizens.

It is natural for tax-cutting states to experience a loss of revenue. But many states have accepted this and taken that step. If Karnataka had not reduced its taxes, it would have earned an additional over Rs 5,000 crore in the last six months. Gujarat would have collected another Rs 3,500-4,000 crore. States that do not reduce VAT have earned billions in additional revenue.

I urge the state government to reduce the fuel tax and extend its benefits to the citizens. States also need to realize that 42 percent of federal revenue goes to the states. I urge all states to follow the spirit of cooperative federalism and work together as a team in times of global crisis.

Thus said Prime Minister Modi.

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