Such a move will seriously impact revenue generation of states, and Kerala will lose Rs 8,000 crore a year, Minister Balagopal said.
The government of Kerala said on Thursday that it will vehemently oppose any move to bring petrol and diesel under the Goods and Services Tax (GST) regime as that will further reduce revenue generation for the state. The state asserted that the Union government should reduce its levies on the two commodities to provide relief to the common people. The GST Council is meeting on Friday, September 17, and it is expected that it will consider taxing petrol, diesel and other products under the GST regime. The council comprises Union and state government finance ministers. Central excise and state VAT (Value Added Tax) make up for almost half of the retail selling price of petrol and diesel. Bringing them under the GST would impact revenue generation for the states. Talking to PTI, Kerala Finance Minister KN Balagopal said that the state will strongly oppose it if there is any move to bring petrol and diesel under the GST regime. He said that the fuel prices skyrocketed due to the huge increase of its cess by the Union government. If the Union Government reduces the cess, it will help in bringing down the prices of petrol and diesel, he said. According to Minister Balagopal, if petrol and diesel are brought under the GST regime, the state will lose Rs 8,000 crore annually. In June, the Kerala High Court, based on a writ petition, had asked the GST Council to decide on bringing petrol and diesel within the GST ambit. Five commodities such as crude oil, natural gas, petrol, diesel, and aviation turbine fuel (ATF) were kept out of the GST purview when it was introduced on July 1, 2017, considering the revenue dependence of the Union and state governments on them. Recently, the spike in global oil prices on demand recovery pushed petrol and diesel prices to an all-time high, leading to a demand for bringing it under the GST. (With PTI inputs) Read from archive: Explained: Why have petrol and diesel prices increased so much?
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