Rajasthan CM Gehlot writes to PM Modi urging further reduction in excise duty on fuel

Rajasthan Chief Minister Ashok Gehlot on Tuesday wrote a letter to Prime Minister Narendra Modi further urging him to reduce excise duties on fuel prices across the country. In his letter, the Chief Minister has also requested for a direction to be issued for oil companies to stop the increase of fuel prices so that people can avail the benefits of the already reduced excise duty. 

Gehlot has been demanding more reduction in excise duty ever since the Central government slashed the taxes by Rs 5 and Rs 10 on petrol and diesel prices, respectively. With the demand for more reduction by Rs 10 and Rs 15 on petrol and diesel prices, he will automatically help in reducing the value-added taxes in Rajasthan by Rs 3.40 on petrol and Rs 3.90 on diesel prices. 

As a result of this reduction, the state government is also ready to bear a revenue loss of Rs 3,500, Gehlot added. 

Reduction in excise duty by Central government seems insufficient: Gehlot

Time and again, the Rajasthan Chief Minister had criticised the Central government for a minor reduction in excise duty and further demanded more reduction for bringing down the inflation in the state. 

Speaking about the revenue loss faced by the state government, he said that the reduction provided by the central government seems to be insufficient as the state government is already facing a loss of around Rs 2,800 every year. Apart from that, the COVID has led to a decrease of Rs 20,000 crore in its revenue which is obtained majorly from the VAT of petrol and diesel. 

Gehlot writes letter to Union Minister Amit Shah

Earlier, CM Ashok Gehlot in a letter written to Union Home Minister Amit Shah appealed for a reduction in the excise duty as levied by the Central government on petrol and diesel prices. Providing the same reasoning, he said that a reduction by the Centre will reduce the VAT of the states automatically.

However, with the current rates, there will be a huge loss in the VAT revenue of the state as the state government has already announced a reduction in VAT by 2% in January 2021. 

Gehlot's statements came after continuous demands by the state BJP unit for reducing VAT from petrol and diesel. Speaking on the same, Rajasthan BJP President Satish Poonia said that the Congress-led state government has levied the highest value-added tax on fuel across the country and thereafter, the BJP demands the state government to reduce these for providing relief to the people. 

(With agency inputs, Image: PTI)