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Old 26th June 2020, 19:35   #166
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

“Truth is stranger than fiction, but it is because Fiction is obliged to stick to possibilities; Truth isn't.” -- Mark Twain

Quote:
Originally Posted by rahul4321 View Post
The increase in percentage of taxation is due to the deficit in the transactional value of fuel spend. As various people have mentioned on the thread, many have not been able to get through a full tank of fuel in the past 3 months or to put it in another subtle way - the spend on fuel has been significantly less during the lockdown period.
Sometimes reality goes against our best assumptions.

It feels like no one is travelling and fuel consumption will be severely down for quite a while but it is not true.
This is similar to how it seems that toll-booth collections must be evenly split between personal and commercial vehicles, but the reality is that personal vehicles contribute only 14% to the toll kitty.

So, let’s leave this notion that the revenue shortfall is here to stay.

Good governance is supposed to stand on transparency in actions.
Even if you choose to overlook all past missteps of any elected government, a harsh reality is that the country may be starved for cash. But what’s wrong is how the leaders today have put themselves on a pedestal and try every trick in the book to insult the intelligence of the general public.

If the elected officials come on stage and proclaim that these hikes are part of temporary measures to compensate for loss in revenue and combine this with a commitment that this will go hand in hand with a freeze on all non-essential spending, everyone here will support them(not that we have a choice) for the greater good of the country.

But what we get is something completely different where its presented like some things are just off the table. The Central Vista project and PM Cares fund are two very "in your face" examples of how some very basic expectations of transparency and judicious spending are being side lined. Its like saying “jo karna hai karle, yeh to aise hi hoga (Do what you want, I’ll do things my way).
I’m sorry but we deserve better.

Quote:
Originally Posted by rahul4321 View Post
I fully support the Government's decision to hike the prices of Petrol and Diesel! It is not ideal - but it is the need of the hour! Impactful decisions are rarely popular - enough history books have been written on that single subject alone.
One should expect rational explanations even from our parents let alone elected officials. This deep-rooted thinking that our elders know better is not conducive to growth.


And finally, I want to just dumb things down from an emotional perspective.
Everyone of us has been impacted financially to varying degrees. Why can’t we catch a break with some relaxation on fuel expenditure to help shore up our savings. If we can’t get some now when crude is so cheap, its unlikely we can expect it anytime in the future. But on paper, Fuel prices are market driven.

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Originally Posted by Thermodynamics View Post
When this very topic was raised to finance minister

https://Youtu.be/jY0Pp-a8rf8
When relevant authorities don't have explanation, why should we debate/defend.

Last edited by theMandarin : 26th June 2020 at 19:43.
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Old 26th June 2020, 19:51   #167
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

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Originally Posted by theMandarin View Post


It feels like no one is travelling and fuel consumption will be severely down for quite a while personal vehicles contribute only 14% to the toll kitty
- Umm, 14% of the Toll kitty is not the same as 14% of the Fuel kitty. Everybody knows that Commercial Vehicles have to pay Tolls compulsorily while Personal Vehicles may not have to navigate through Toll Roads in their daily commute OR even when they do - may not be subjected to Tolls (In Ahmedabad for example - Local Personal Vehicles can use State Toll Roads in Ahmedabad and the outskirts of Ahmedabad city without paying tolls. They get waved through or have a free lane). Motorcycles on the other hand pay no tolls whatsoever at all

Quote:
Originally Posted by theMandarin View Post
“ Good governance is supposed to stand on transparency in actions.
Even if you choose to overlook all past missteps of any elected government, a harsh reality is that the country may be starved for cash. But what’s wrong is how the leaders today have put themselves on a pedestal and try every trick in the book to insult the intelligence of the general public.
Agreed. Some of the past and present leaders have been utterly condescending to the general population at large and have simply put down reporters / the general population when they have asked clear and logical questions which absolutely do deserve an answer. But they get insulted by these leaders under the guise of asking "stupid questions" which they are actually not. Would love to take names of these so called experts but I wont.

Last edited by rahul4321 : 26th June 2020 at 19:58.
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Old 26th June 2020, 19:55   #168
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

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Originally Posted by wildsdi5530 View Post
So just be patient guys.
People are *not* paying a fair price for fuel. Public memory is short. Fuel hike is old news. Bring on the next thing
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Originally Posted by drmohitg View Post
Statues get votes.
Unfortunately national park animals don't vote - link.
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Originally Posted by Jammy70 View Post
Did someone say pandemic; or shortage of funds?
In our country, the rulers were always rich. Ordinary folks were poor throughout history.

Last edited by msdivy : 26th June 2020 at 20:08.
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Old 26th June 2020, 20:04   #169
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

Quote:
Originally Posted by rahul4321 View Post

The increase in percentage of taxation is due to the deficit in the transactional value of fuel spend. As various people have mentioned on the thread, many have not been able to get through a full tank of fuel in the past 3 months or to put it in another subtle way - the spend on fuel has been significantly less during the lockdown period. Even after the lockdown has opened up, the spend on fuel is not at normal levels because of a lot of offices which are still operating the WFH model and most of the leisure travel been cancelled due to the travel not being a necessity in these times.

The Government needs a certain amount of fixed inflow each month which has been planned out carefully keeping the public expenditure in mind. In the last 3 months, the Public Expenditure has shot up considerably (due to COVID and Defence) but the Revenue from taxation (especially from fuel) has decreased by a huge margin.
Let me understand this - are you saying the higher taxation is justified because of the almost-nil collections over the last 3 months, and the continued low revenues? If that is the case, there's nothing wrong if companies/industries which had to shut down or struggled to pay even salaries during the last 3 months' period due to no or low sales, increase their products' selling prices substantially, right? And hospitals - those which were not part of the Covid-19 treatment and had to sent some of their staff home - should be collecting double or triple their fees now, I guess. Similarly other sectors too - service, hospitality, all of them.

My limited knowledge of economics tells me that's a strong prescription for high flying inflation, and we will all be ...!

Friend, if the government wants to mop up additional monies, shouldn't they REDUCE the taxes so that consumption goes up and they make up the shortfall over a period of time? Live example from the liquor industry (which I am part of) - in an effort to collect more revenues after seeing the rush when liquor outlets opened last month, most governments increased the duties substantially. What did that do? Sales came tumbling down and they are not even getting a fraction of their revenues now since people are buying cheaper brands and in smaller quantities. Obviously, this has impacted the distribution chain as well and many of the retailers are struggling to pay their rent.

In my view, just as in the case of the liquor industry where the spike in taxes could have been to control people's spending on liquor, the ONLY possible explanation for this continued spike in fuel prices is an attempt by the government to tell us: "hey, the lockdown may be over, but we prefer you to stay at home!"

PS: Announced today - Karnataka Govt will begin work tomorrow on the 108-feet tall Kempegowda statue near the international airport, spending 78 Cr. and it will be ready by 27th Jun 2021. Did someone say pandemic; or shortage of funds? I don't even have enough fuel to make the 100km (to-and-fro) journey to attend the Bhoomi Puja, even if I wanted to!

PPS: Not trying to make a political statement here, but I just hope we all can look at things objectively.
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Old 26th June 2020, 20:17   #170
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

Quote:
Originally Posted by Jammy70 View Post
Let me understand this - are you saying the higher taxation is justified because of the almost-nil collections over the last 3 months, and the continued low revenues? If that is the case, there's nothing wrong if companies/industries which had to shut down or struggled to pay even salaries during the last 3 months' period due to no or low sales, increase their products' selling prices substantially, right? And hospitals - those which were not part of the Covid-19 treatment and had to sent some of their staff home - should be collecting double or triple their fees now, I guess. Similarly other sectors too - service, hospitality, all of them.
If the company/industry was shut down and did not pay salaries during the last 3 months period - why should it increase their prices now? They had no revenue and no cost / low revenue and low cost.

Quote:
Originally Posted by Jammy70 View Post
Friend, if the government wants to mop up additional monies, shouldn't they REDUCE the taxes so that consumption goes up and they make up the shortfall over a period of time?.
Theoretically - yes you are right. Practically (in my personal opinion- no). Because of this unprecedented event that has taken place, we are in the following situation where


The spending power of people has drastically reduced due to everybody taking a salary cut or even being laid off. Even considering the lower taxes - people in the next 6 months will only buy the essentials and nothing else. Also, Cash will be king. People will hoard cash (and not spend it on non-essentials) thereby nullifying the effect of reduced taxes (as taxes cannot be collected if there are no purchases)


Quote:
Originally Posted by Jammy70 View Post
In my view, just as in the case of the liquor industry where the spike in taxes could have been to control people's spending on liquor, the ONLY possible explanation for this continued spike in fuel prices is an attempt by the government to tell us: "hey, the lockdown may be over, but we prefer you to stay at home!"
- The Government will always make money from addictions - especially those which can be considered to be "deterimental to public health in their eyes" - Ciggerates, Liquor etc
.

Last edited by rahul4321 : 26th June 2020 at 20:22.
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Old 26th June 2020, 20:27   #171
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

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Originally Posted by rahul4321 View Post
I cant help it if you misread/misinterpret my statement of "fully supporting the Government's decision to hike the prices" as being equated to "the PM, FM, DM etc have provided me with the reason of the hike"
Sir, this entire thread is pointless. Those of us who try to reason it out with angry members here become fascists or ignoramuses of history (as if there exists a pandemic playbook that these members know of). Now very rudely, an esteemed member has found it fit to accuse you of being cosy with FM, PM, DM, SM etc.

I would suggest that you make an exit from this thread and never look back. Life is good for those of us who are above the ground.

Oh, and do not dare to feel any pride in Indian culture either. That makes you an ignoramus or a fascist too, apparently. I saw a fellow member getting bludgeoned on the Coronavirus thread for saying that he's proud of Indian culture for having Namastes instead of handshakes. That member felt so hurt (I PM'd him here on the forum when the incident unfolded) that he has not come back to the forum at all since March of this year. I haven't seen him here at all.

So yes, stay away from any such contested discussions - because, how dare you have an opinion! How can you be right?! Grrr. Let's discuss automotive stuff instead on other threads
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Old 26th June 2020, 20:30   #172
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

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Originally Posted by Jammy70 View Post

Friend, if the government wants to mop up additional monies, shouldn't they REDUCE the taxes so that consumption goes up and they make up the shortfall over a period of time?
.
The best way to maintain sanity in the current situation is to allow the folks who think that 3000+ crore China made statues (Sardar Vallabhbhai's, for instance) are good but Chinese food made by Indian vendors is bad is to avoid interacting with them. They will make you believe you are wrong, the sheer numbers are astounding. The world over, Indian trolls have become the benchmark of online manipulation. A sub-reddit dedicated to these trolls has over 300,000 members, more than the entire reddit community in India itself. Almost every net-savvy user knows that India is plagued by a fake information, fake opinion and fake-confidence narrative that is absurd and is harming the most vulnerable citizens.

Sadly, you cannot beat these folks, so the best way to stay sane is to ignore this. Afford the petrol/diesel if you can and get called a "state beneficiary communist" or other adjectives if you can't. You cannot reason with people who abandoned their reasoning abilities and surrendered themselves to the interest of a political party and not India as a nation. I have tried it, unsuccessfully, and I realized it is much better to not interact politically if you can afford to do so.

More than 99.9% of India is outside online forums and they will vote for change if they feel the need to. If they think distractions and masterstrokes performed by fake nationalists are enough, god bless our country, but we definitely deserve it for not taking social and political education seriously over the decades. Hopefully, the next generation will see better.
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Old 26th June 2020, 20:46   #173
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

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Originally Posted by locusjag View Post
Sir, this entire thread is pointless. Those of us who try to reason it out with angry members here become fascists or ignoramuses of history (as if there exists a pandemic playbook that these members know of). Now very rudely, an esteemed member has found it fit to accuse you of being cosy with FM, PM, DM, SM etc.

I would suggest that you make an exit from this thread and never look back. Life is good for those of us who are above the ground.
I agree with you esteemed sir. I saw the petulent brickbats on your very logical arguments and was watching how public opinions can be dictated by the general consensus and Government-bashing which is apparently very fashionable these days. I would actually go away and not look back on this thread. However, the issue is - I have had a circa 30% reduction in my workload (and a 30% reduction in my salary until September 30)

Due to this I find myself with time to spare in my working day and so I enjoy wrestling it out in the muck.

A shame that member left. Water off a duck's back - I give it back as good as I get. Our family's Cast Iron Bullet taught me this lesson. I used to kick it - and it kicked me back a hundred times worse. Life Lessons from a CI - I call it.

But you are right. Maybe i'll go and join the Nepotism debate now on some other forums I have been following. Lots of people bashing Nepotism these days- maybe I should join as Pro-Nepotism in keeping up with my character here

Last edited by rahul4321 : 26th June 2020 at 21:13.
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Old 26th June 2020, 21:15   #174
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Can we close this thread please, it's not serving the purpose ?
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Old 26th June 2020, 21:24   #175
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

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Originally Posted by rahul4321 View Post
If the company/industry was shut down and did not pay salaries during the last 3 months period - why should it increase their prices now? They had no revenue and no cost / low revenue and low cost.
Let me clarify - the 'shut down' of many of the businesses during the lockdown was not out of choice, but due to the circumstances. Many of the employees had to take a pay-cut, or in some extreme cases, deferred salary payments, too. So it's not as though there are no expenses, and we haven't even talked about the capital expenses. So there are expenses which will come back to bite you at some point.

Quote:
Originally Posted by rahul4321 View Post
Theoretically - yes you are right. Practically (in my personal opinion- no). Because of this unprecedented event that has taken place, we are in the following situation where


The spending power of people has drastically reduced due to everybody taking a salary cut or even being laid off. Even considering the lower taxes - people in the next 6 months will only buy the essentials and nothing else. Also, Cash will be king. People will hoard cash (and not spend it on non-essentials) thereby nullifying the effect of reduced taxes (as taxes cannot be collected if there are no purchases)
Ahem - So since the 'spending power of people has drastically reduced', why increase taxes on fuel? Isn't fuel an essential for a person trying to get their life back in order?

Quote:
Originally Posted by rahul4321 View Post
- The Government will always make money from addictions - especially those which can be considered to be "deterimental to public health in their eyes" - Ciggerates, Liquor etc
.
Well, thank you - I realised that 20 years back when I joined the industry. But that's not the crib I had, or has nothing to do with the point on the impact of higher taxes on sales of a product or service - vice or not a vice.

Anyway, looks like you have your views and I have mine and probably "never the twain shall meet".

Ciao!
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Old 26th June 2020, 21:28   #176
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

Wow, and these same chaps were moaning lest than a month ago the state exchequer was too poor to pick up the bus/train fare tab for a few thousand stranded laborers.

Not very good at lying, but then I guess it's like the Nigerian prince scam. The bad lying is intentional, to see who falls for it.

Last edited by Chetan_Rao : 26th June 2020 at 21:31. Reason: typo
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Old 26th June 2020, 21:38   #177
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

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Originally Posted by Jammy70 View Post
Let me clarify - the 'shut down' of many of the businesses during the lockdown was not out of choice, but due to the circumstances. Many of the employees had to take a pay-cut, or in some extreme cases, deferred salary payments, too. So it's not as though there are no expenses, and we haven't even talked about the capital expenses. So there are expenses which will come back to bite you at some point.
Some costs like Salary Deferrals (if the company HAS agreed to pay salaries to the staff despite them not working) for the 2-3 months of lockdown will have to be paid out of their Reserves. Its very unlikely that these companies operate on a penny-to-penny basis and have no Reserves at all considering we are talking about For-Profit companies and not about Not-For-Profit Companies.

On the other point - I think you may have meant Fixed Costs. They can be further divided into two parts ; Cash and non-cash. Depreciation for example is a Non-cash Fixed Cost expense and can be discounted from this discussion as it does not have to be physically paid out through the bank account each month until you are at the horizon point of time where the depreciated asset has to be replaced. Rent Costs for example (if not waived off) is a Cash Fixed Cost and will remain. Nothing can be done about that unfortunately.

Quote:
Originally Posted by Jammy70 View Post
Ahem - So since the 'spending power of people has drastically reduced', why increase taxes on fuel? Isn't fuel an essential for a person trying to get their life back in order?
Yes- but why you are strengthening my argument? . The Government increased taxes on fuel because it is one of the essential spends. Increase taxes on a movie ticket, or a pair of Nike Shoes or a KTM 790 duke and the extra cash (by way of increased taxes) will never hit the bank account because nobody/very few people will purchase these non-essential items in the short term future. However, everybody will still continue to purchase fuel.

Quote:
Originally Posted by Jammy70 View Post
Anyway, looks like you have your views and I have mine and probably "never the twain shall meet".

Ciao!
They may never meet but I understand and respect your views - its just that I may not necessarily agree with them. Cheers!

Last edited by rahul4321 : 26th June 2020 at 22:02.
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Old 26th June 2020, 21:52   #178
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

Just adding one bit here- our forex reserves just crossed $500 billion for the first time ever. Thatís a wonderful milestone to have at this point of time. That FDI have increased and sentiments of the foreign investors is also very high.

Now why I am stating this in a thread about rising fuel prices ? Well, I got the feeling from the thread here (at least some surely) that our government is dealing with a pandemic and a hostile foreign country and hence there is need for hiking the prices which have now reached absurd levels. The useless spendings aside, just want to state that foreign reserves are kind of a cushion to deal with any exigencies.

To quote from the link-

Reserves will provide a level of confidence to markets that a country can meet its external obligations, demonstrate the backing of domestic currency by external assets, assist the government in meeting its foreign exchange needs and external debt obligations and maintain a reserve for national disasters or emergencies.

And now my question- keeping everything aside, is the hike of fuel prices which has turned into a cruel joke still so necessary ??

https://indianexpress.com/article/ex...onomy-6456852/
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Old 27th June 2020, 00:23   #179
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

This is getting interesting.

The intent of the govt is to collect more revenue.
Assumption is, this will be used for our welfare and not for their pockets.

Now which is the most efficient way?
a. (High margin) increase fuel prices so that every litre sold will bring in more money. But then people will buy less because the price is high.

b. (High volume) decrease the fuel prices so that volume of sales will increase compared to above point and will bring in more money.

I think nobody has the answer, surely not our govt.

Thanks.
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Old 27th June 2020, 05:43   #180
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Default Re: Fuel prices increase 16 days in a row. What the hell is happening?

High margin is always always better than high volume, as high volume increases import. I for one happy that government is increasing fuel taxes than personal tax, I was fed-up of seeing many people enjoying more facilities without having to pay any income tax. I guess around 2016 time government did give the benifit of lower crude, but what happened was that, states increased taxes and never saw any private players (bus or taxi) passing the same benifits to customers.

Since many private constructions and related activities are halted, it's good government is planning to spend on statues and or roads. It's always better to pay someone for the work rather than handing over free money.
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