BJP leader Sushil Kumar Modi on Wednesday said it is not possible to bring petrol and diesel under the GST regime for the next 8 to 10 years as it would cause an annual revenue loss of Rs 2 lakh crore to all states.
Centre and states collectively collect over Rs 5 lakh crore tax on petroleum products, Modi told the Rajya Sabha while participating in a discussion on the Finance Bill 2021.
In the first reduction in rates in over a year, petrol price on Wednesday was cut by 18 paise per litre and diesel by 17 paise a litre as international oil prices tumbled to the lowest since early February.
Petrol price was cut to Rs 90.99 a litre in Delhi from Rs 91.17 per litre. Diesel now comes for Rs 81.30 a litre in the national capital, down from Rs 81.47 previously.
Rates have been reduced across the country and vary from state-to-state depending on the local incidence of taxation (VAT). This is the first reduction in fuel prices in over a year. The prices were last reduced on March 16, 2020.
Sushil Modi further said that the highest tax slab in GST is 28 percent. Right now we are taking a 60 percent tax on petrol and diesel. In such a situation, the loss of revenue of two to two and a half lakh crore rupees will be compensated from where. If it is brought in GST, then the center will get 14 rupees and the states will get only 14 rupees tax. In such a situation, it is not possible to bring petrol and diesel in the GST for the next 8 to 10 years. Neither Congress-ruled states nor BJP-ruled states will agree to it.
He also stated,”It is said that tax collected on petrol, diesel goes into the pocket of government. There is no separate pocket of government. From where the money will come for providing electricity and tap water to all households. The spending of tax collection on welfare of country is being challenged.”
Reacting to remarks against the GST regime, he said,”Some people also said that this is Gabbar Singh Tax. No state has opposed the tax structure of GST in any GST Council meeting. You can see the proceedings of the council (to verify that),” he said.
He stressed that only the government under the leadership of Prime Minister Narendra Modi had the guts to implement the GST regime in the country.
