[spindoc]

The infographics shared do have facts but they don't seem to present the complete / objective facts.

For e.g. Kerala and Delhi are called out for VAT increase but it is also a fact that Goa (under the same party) announced a really steep increase (~15%) in VAT on Petrol 4 months ago.

Like lurker has mentioned above, the countries mentioned are all further from the Persian Gulf than India. If you compare with countries like Pakistan (~ 44 INR), Sri Lanka (~ 54 INR) etc. our prices are way higher.

The answer most likely lies in the tax structure and that's something the central and state govts must get together and address.

[lurker]

the big plan seems to be, to hike fuel prices and ride on fuel taxation as lacunae for all ills and revenue collection deficit. Since fuel is easiest and most effective mode of taxation as found by our lazy yet inefficient samosa guzzling bureaucrats.

Now come 2018 some drastic law or fuel cut will be announced as onset of ache din for masses as election sop before 2019 GE. And after that who cares, fuel pricing is free to be raised again as the perpetrator wants. So if GST based pricing is announced in 2018, then in 2019 post election cess on GST can also be announced in same vein.

In short there is no guarantee which way fuel will go in our country.

[RaghuVis]

Originally Posted by lurker

the big plan seems to be, to hike fuel prices and ride on fuel taxation as lacunae for all ills and revenue collection deficit. Since fuel is easiest and most effective mode of taxation as found by our lazy yet inefficient samosa guzzling bureaucrats.

Now come 2018 some drastic law or fuel cut will be announced as onset of ache din for masses as election sop before 2019 GE. And after that who cares, fuel pricing is free to be raised again as the perpetrator wants. So if GST based pricing is announced in 2018, then in 2019 post election cess on GST can also be announced in same vein.

In short there is no guarantee which way fuel will go in our country.

Control your emotions as well as your language my friend

Just one doubt.
Is there any rule that says State governments cannot reduce their taxes? Why there is call only to reduced CESS and central government taxes? I understand that Central reduction will be beneficial for all, but can't states lower taxes to show moral high-ground and prove that they care for people?

[knightrider_7]

Originally Posted by RaghuVis

I understand that Central reduction will be beneficial for all, but can't states lower taxes to show moral high-ground and prove that they care for people?

Yes, it is possible for the state government. State government is charging their tax over and above the price after the excise duty imposed by the Centre. The previous Kerala government had decided not to take the additional income from petrol price hike during their reign. Sadly, the current government is not so keen to do it now, since the income from these taxes are third in the list, just after GST and Liquor taxes.

[deepv]

Originally Posted by LordSharan

...
This link from India Today says that if petrol/Diesel came under GST, the prices would come down to 51/39 INR/L respectively How is it even possible?

Originally Posted by CarguyNish

It's very simple, the lone reason why Petroleum Products & Liquor haven't been included in GST is because of their tax bracket. Don't know about Liquor, but the Fossil Fuels are taxed at 54%. And you don't have a 54% Tax slab in GST.
...

If you look at the above calculation from the same article, the price before taxes and commission is about Rs 31/-.
Taxes on top amount to about Rs 36/- which is more than 110% of the price.
This would NOT be the case under GST, hence the reduction would be similar to calculations you pasted earlier.

[Col Mehta]

Just gone through the following article which states that fuel prices could drastically come down should our government taxed both petrol and diesel under GST. Apparently, petrol in Delhi would cost a maximum of 50.91 Rs (28% taxation plus SUV compensation cess) which is about 20 Rs cheaper than the existing rate!! Diesel, likewise, would cost a maximum of 49.08 Rs including everything which is about 10 Rs cheaper than the current rate!!

Bizarre, isn't? But as we all know, it is very unlikely that the government would make such changes. They wouldn't want to risk losing one of the easiest ways to rip us off. Here is the link -

http://m.indiatoday.in/story/petrol-...1/1048063.html

[yatin]

Is there a way the Centre & states can maintain revenue if fuel is brought under GST? Otherwise, it will happen when there is political benefit.

GST anti-profiteering would prevent the oil companies from increasing their margins to compensate indirectly for excise loss or State VAT loss. Dealer margin too can't be increased, I guess.

I feel the ruling dispensation will suck as much as it can until 1 year before elections, bring fuel under GST but spend the sucked funds in that 1 year itself. Either they will be re-elected on such goodwill, which is the best case (I don't think anybody hopes for a 3rd consecutive term). Or ... the next ruling dispensation is stuck with lesser revenue sources (unlikely to push up cess beyond 50%, especially when cess should be being abolished).

[VeluM]

Even if fuels are brought under GST and prices come down, the government has a stated goal of discouraging the use of these fuels. Therefore I'm sure there will a meeting of the GST Council where an additional cess will be levied on both fuels to bring them to par with current rates, similar to what happened after cars were brought under the GST regime. In short - consumers will not benefit.

Originally Posted by yatin

Is there a way the Centre & states can maintain revenue if fuel is brought under GST? Otherwise, it will happen when there is political benefit.

SGST is an option, but as far as I understand the way GST works means that the Centre will then lose out on their share due to the GST credit for tax already applied. I could be completely wrong though.

The states' myopic opposition to this move due to lost revenue has caused the central government to feel the return on the time and effort is too low to be bothered about GST on fuels at this time, IMO.

On a separate note it is interesting that the pre-tax cost of petrol is actually around a rupee lower than diesel. The central and state taxes cause the price differential, which doesn't make any sense in the current government sentiment against diesel.

[ssambyal1980]

Originally Posted by Col Mehta

Just gone through the following article which states that fuel prices could drastically come down should our government taxed both petrol and diesel under GST. Apparently, petrol in Delhi would cost a maximum of 50.91 Rs (28% taxation plus SUV compensation cess) which is about 20 Rs cheaper than the existing rate!! Diesel, likewise, would cost a maximum of 49.08 Rs including everything which is about 10 Rs cheaper than the current rate!!

Bizarre, isn't? But as we all know, it is very unlikely that the government would make such changes. They wouldn't want to risk losing one of the easiest ways to rip us off.

Absolutely sir there cannot be denying to the fact that with the fuel taxation under its ambit the government has got an easy and legal means to rip off the common man under the guise of social welfare spending, infrastructure development and the likes. Given the current political scenario its quite unlikely that the central government will go ahead with bringing the fuel prices under GST ambit despite the flak it is receiving from all quarters. And there are certain reasons for it which the government deems fit:

1. With general elections still about two years away, the government has no dearth of time in carrying on the way it likes.

2. With demonetization not proving to be a game changer and subsequent slowing of economic growth there has been dearth of means to collect revenue in the form of taxes as such the government doesn't want to lose an effective means of earning revenue by taxing fuel.

3. With number of defense purchase agreements (Combat Helicopters, Fighter Jets and Howitzers) in the pipeline the government needs money for their funding as such it cannot plug in its richest source of revenue.

Despite under pressure the government has so far shown no signs of relenting as far as the lowering of fuel prices are concerned. To quell criticism it is facing it has many legitimate points to support its decision but nonetheless it would be interesting to see how things shape up because any reluctance on its part will surely have far reaching impact on its goodwill and may spring in unpleasant surprises for it in the next general elections.

Regards

[lurker]

So day before yesterday was only day without any price rise. Programming was back on schedule yesterday with 3 paise rise and today again back to the familiar 5 paise raise.

Look how clever our politicians are, they will take money from your pocket and claim to help/poor, build toilets and take all credit solely for themselves. Each toilet/scheme introduced in this fashion should be credited solely to the *tax payers of India* and not credited to any political party or individual politician. How would bhpian feel if I took their money by hook or crook and built toilets, factories in my neighbourhood and sweep all goodwill in my burough at your expense. This is what is happening. Wonder why none of our previous administrations had such brainwave.

[ssambyal1980]

Union Minister justifies fuel price hikes and related taxes. Just look at the reasons he gave.

Union Minister K J Alphons says "We are imposing the taxes because the poor of this country will have a dignified life, they will have toilets, houses. All this money that is being collected is not being stolen by our Prime Minister or by the ministers. It is an intentional decision taken by the government. So we are going to tax people who can afford to pay. Who buys petrol? Somebody who has got a car or bike. Certainly he is not starving. Somebody who can afford to pay has to pay".

Poverty removal and population control have never been a serious agenda for most of the political parties. Both these problems have largely remained a political rhetoric to justify the taxation in guise of running welfare schemes for the poor. The fact remains that the revenue collected through taxation mostly goes in to funding populist schemes rather than social welfare. And the hidden motive behind all this is to keep the larger vote bank intact.

[saket77]

Originally Posted by ssambyal1980

Union Minister justifies fuel price hikes and related taxes. Just look at the reasons he gave.


Poverty removal and population control have never been a serious agenda for most of the political parties. Both these problems have largely remained a political rhetoric to justify the taxation in guise of running welfare schemes for the poor. The fact remains that the revenue collected through taxation mostly goes in to funding populist schemes rather than social welfare. And the hidden motive behind all this is to keep the larger vote bank intact.

So, it 'pays' to be poor!

Going by this statement, now petrol is a luxury item.

We are already paying income taxes and now this GST which has made nothing cheaper and most of the things have become expensive than before. Even products like insurance (both Health & Life), which one funds himself have become straightway dearer by at least 3% just because of 18% GST (previously 15% service tax). When Govt should be promoting and encouraging these social security schemes, esp when the individual himself is funding it, it is absolutely disgusting to tax them heavily. Gives a message that social security be damned, the Govt only wants taxes.

This argument by Mr. KJ Alphons, and more so the choice of his words is disappointing. And because you have the power to tax, does not mean that you will tax a commodity which is definitely not a luxury item with ridiculous rates. The biggest joke was 'deregulation' of prices which still means the OMCs are shielded when prices are rising because the final price charged to consumers will be higher as well. But in case of falling crude, the Govt will jack up taxes to that their kitty makes the full out of the situation.

I am all in for the reforms, but not at the cost of being a dacoity victim.

[dgogold]

So, just because I've got a job and earn money to support certain daily needs, it becomes my social and economic obligation to feed the unfed. I do understand that the impoverished do have the need to be provide for and its a very common practice to coax the well to dos. But why the sham of putting cess or tax on petrol or alcohol or cigarettes or etc etc. Why can't the minister or the government come up with a "poor tax" kind of thing? Where you are forced to contribute a certain part of your income for the up-liftment of the downtrodden if you earn a salary. Why does the government have to act like Robin Hood when they are in power? The minister's statement is really unfortunate. Being a public servant, he justifies improper taxation of the public in such a manner. The whole system is a joke and we are been taken for a free ride. Achchey Din aaney wala hai!

[MCR]

So according to the logic presented by the "great" minister, I have to work hard only to pay for some nonsensical schemes and not really save for my selves or for my family!

Already we have high income tax slabs and over that, we are being robbed big time in the name of Good Simple Tax. I think it's highly irrational from the government of the day to just squeeze people who work hard and can pay taxes for the benefit of many lazy bums. Sigh!

[Ragavsr]

Looks like the ultimate aim of this government is to make everyone starve. The government here is saying that we will increase taxes until everyone starves. The tax burden imposed by this government puts British rule to shame.

Why can't this minister simply at least shut up and mind his own portfolio which is tourism.Why should I shell more out of my hard earned already heavily taxed income to build toilets and houses for the so called poor.

I am losing patience with this government.
1. Failed drama of demonetization
2. Loot in the form of GST. The prices of 99% of the goods have increased substantially.
3. Loot in the form of fuel. Deregulation of fuel has been used only to raise prices. When crude prices fall the government raises taxes to increase the loot instead of cutting prices.

Another clown in the transport minister wants to reduce the only growing sector of manufacturing - the automotive sector by crippling it with a thousand cuts.