Here’s why fuel should be brought under GST: Price per litre will drop by Rs 22 in Delhi, Rs 32 in Mumbai: Union Minister and senior BJP leader Nitin Gadkari is famous for his pragmatism as much as much as he is known for his project execution skills.
So this is the jaws dropped collectively which made a case for not reducing taxes on petroleum products on the erroneous ground which is the ground several of the welfare and infrastructure projects of the government.
Though, his colleague, the one who is closer to ground zero, Dharmendra Pradhan, the Union Oil Minister, has not been mincing words.
This one is an ardent votary of petroleum products being brought under the Goods and Services Tax (GST) that is the perception can bring down the oil prices to half.
Another person equally closer to ground zero, Devendra Fadnavis, the Maharashtra Chief Minister, too has come out openly in support of fuel being brought under the GST thus this one can provide a lasting solution to the vexed problem of climbing fuel prices for consumers also.
The windfall tax proposed on the little oil produced in the whole nation that can be thrown out of the nearest window.
This is the way to kill fresh investments in the oil exploration business in the whole nation which is also required.
This is wrong to ascribe windfall status to the extra revenue which is earned by the domestic producers on the back of rising international prices which can be wrong to impose the windfall tax on life-saving drugs.
Both can be driven away fresh investments in crucial areas that are also the passerby if a ripe mango is blown away by the wind and falls on the ground that is the windfall but at the period of the international crude price breach the arbitrary figure of $70 per barrel.
Bringing petroleum products under GST brooks in the no delay time and these all need is to the convening of the GST Council meeting immediately. To be sure
To be sure, our GST Council functioning likes the World Trade Organisation (WTO) that is often stymied by the required for the unanimity to pass a resolution. Unanimity
Unanimity is as cruel in the extreme level but, Piyush Goyal, the Finance Minister, should nevertheless convene the GST Council meeting and dare the Opposition. Let
Let the obstructors and obfuscators be exposed. Petroleum products can no longer be milch cows for the government sector.
GST works are assuming the peak rate of 28 percent is what mollifies the Opposition besides suiting the central government.
At the current time, the Delhi government imposes 27 percent VAT on petrol. The selling price to dealers is Rs 37.89. To this, when excise of Rs 19.48 is added besides dealer commission of Rs 3.63, that can make the petrol bunk price Rs 61 per litre.
The 27 percent VAT on this results in a final price of Rs 77.47 per litre to consumers.
Dealer price remains the same at Rs 37.89 which add the same to the dealer commission of Rs 3.63. The petrol bunk price before GST can be Rs 41.52. On this GST of 28 percent would lead to a tax revenue of Rs 11.63, that is making for an affordable consumer price of Rs 53.15.
Accordingly, this theory the consumer can save Rs 22 in Delhi when fuel is brought under the GST. Similarly, the consumer in Mumbai can also save the Rs 32 per litre of petrol as current value-added tax (VAT) that is much higher at 39 percent compared with 28 percent GST.
The GST eschews tax on tax besides reining in states’ greed in fixing rates whimsically.
All consumers in the Kolkata and in the Mumbai can have a great sigh of relief. Indeed, the whole nation will also have.
The county can also have one tax and one price can become the reality for this arguably most sensitive item on one’s purchase basket and budget same.
If unanimity eludes the Narendra Modi government at the GST Council meeting which looks worth for this purpose, let the bigoted Opposition be exposed soon post they forged an anti-Modi front in Bangalore a few days ago and display it in full view of TV cameras.
The next course of action, albeit less desirable, that is for the BJP-ruled states to reduce their own VAT on petroleum products so that the consumer will have to pay the price which is come under the GST regime that alas was that is because of the Opposition intransigence.
This would, though, shame the Opposition like nothing else anyway.
The GST is transparent whereas the proposed windfall tax that is also convoluted with no back-to-back relationship between the taxes which is being passed on to the consumers.
There is no guarantee whichever is passed on to the consumers. Even if there is a binding guarantee through law, finding wherewithal for its seamless and automatic transmission to consumers that somehow looks impossible anyway.