Fuel prices: Chidambaram slams Modi govt; says Centre owes Rs 78,704 cr to states

Former finance minister P Chidambaram on Thursday hit back at the central government after Prime Minister Narendra Modi's appeal to states to reduce the Valued Added Tax (VAT) on petrol and diesel, saying the finance ministry announced that the Centre owes Rs 78,704 crore to states. In a series of tweets, Chidambaram alleged that amount owed is "actually more."     "If you add the amounts that the States claim are owed to them, the total amount may be bigger. Only the Controller of Government Accounts (CGA) can certify the correct amount," he tweeted.  

Also Read: Modi flags higher fuel price in opposition-ruled states, seeks reduction in VAT   "It will be interesting to know why the MoF embarrassed the PM on the day he chose to admonish the States!" Chidambaram said in another tweet.  

Meanwhile, slamming the opposition, Petroleum minister Hardeep Singh Puri, in a series of tweets, clarified, "Petrol will be cheaper if opposition ruled states cut taxes on fuel instead of imported liquor! Maharashtra govt imposes Rs 32.15/ltr on petrol & Congress-ruled Rajasthan Rs 29.10 But BJP ruled Uttarakhand levies only Rs 14.51 & Uttar Pradesh Rs 16.50 Protests cannot challenge facts!"

"The truth hurts, but facts speak for themselves. Maharashtra Govt has collected Rs 79,412 crore as fuel taxes since 2018 & is expected to collect 33,000 cr this year. (Adding up to a whopping Rs 1,12,757 cr). Why did it not reduce VAT on petrol & diesel to provide relief to people?" he said in another tweet.

Puri further stated that BJP-rules states have a VAT on petrol and diesel in the range of 14.50 to Rs 17.50 per litre, while taxes levied by states ruled by other parties are in the range of Rs 26 to Rs 32  per litre.

"The difference is clear. Their intent is only to protest & criticise, not extend relief to the people," the oil minister noted.

"Truth hurts, but facts speak for themselves. 18% VAT on petrol & 16% on diesel in Haryana among lowest. An aspiring leader from the state protests against these, but is silent on Rajasthan ruled by his own party which imposes 31.08% +?1500 /KL cess- among the highest in country!" Puri further stated.   The Congress on Wednesday also slammed the government after PM Modi's appeal to opposition-ruled states to lower the VAT on petrol and diesel, saying the excise duty during the UPA government was much lower than what it is under the Modi regime and asked the prime minister to roll back the hike.     Congress leader Randeep Surjewala alleged that the Modi government has earned as much as Rs 27 lakh crore from taxes on petrol and diesel and demanded an account of the money. 

Also Read: Not a fact that fuel prices more expensive due to states: Uddhav Thackeray

 "Modiji, no criticism, no distractions, no Jumlas! Excise Duty during Congress Government - Petrol - Rs 9.48/litre and Diesel - Rs 3.56/litre. Modi Government - Petrol - Rs 27.90/litre and Diesel - Rs 21.80/litre. Please roll back the excise hike of Rs 18.42 in Petrol and Rs 18.24 per litre in Diesel," Surjewala said on Twitter.     He said the party will urge the states to decrease VAT on fuel to pre-May 2014 level, but the Centre must also admit that it earned Rs 27 lakh crore in earnings from petrol and diesel, against Rs 16.5 lakh crore earned collectively by states.     "The central government revenue from petrol/diesel has doubled in 8 years," Surjewala said.  

The Congress leader said that on May 26, 2014, when Prime Minister Modi assumed charge, the crude oil was US $108, but petrol and diesel was at Rs 71.41 and Rs 55.49 per litre.  

"But today, crude oil is US $100.20 per barrel, but the petrol/diesel prices have been increased to Rs 105.41/litre and Rs 96.67/litre in Delhi," he said.  

Union minister Anurag Thakur parried the Congress' attack asking the party why it was depriving people of the benefits of lower petrol and diesel prices.     He said the BJP-ruled states reduced VAT on petrol and diesel a few months back, whereas the governments ruled by opposition parties still have not done it.     BJP-ruled states reduced the taxes, and Karnataka lost Rs 5,000 crore, Gujarat lost 4,000, and many other states lost taxes worth crores of rupees, but people there benefitted from lower petrol and diesel rates, Thakur stated.     Earlier in the day, PM Modi pointed out that some states did not reduce VAT on petrol and diesel despite the cut in excise duty by the Centre last November.  

He said the states had done "injustice" to the people by not transferring the benefits of the cut to them.     Speaking at an interaction with chief ministers on the emergent COVID-19 situation in the country, Modi said he wanted to flag the challenges being faced by the people due to the war.