Fuel price politics has heated up with the BJP taking to the streets to push the Opposition-ruled States to cut tax on fuels.

While in Punjab, which is heading for polls, the Congress government has lowered levies, in other non-BJP ruled States, a flurry of backroom parleys are on to rebut the BJP’s narrative that the Value Added Tax, additional duties and cess imposed by the States are responsible for high fuel prices.

BJP workers held protests in Delhi, West Bengal, Kerala, Rajasthan and Chhattisgarh demanding the State governments to decrease VAT on petrol and diesel.

Punjab, in the meantime, has decreased the petrol and diesel prices by ₹10 and ₹5, respectively.

“Punjab is a different case. The State has a cess of ₹2,050 imposed for a kilolitre of petrol and ₹0.10 per litre as Urban Transport Fund and ₹0.25 per litre as Special Infrastructure Development Fee. The Value Added Tax on petrol there is 24.79 per cent and an additional 10 per cent tax on VAT is also added on every litre.

“Similarly, on diesel, the cess is ₹1,050 per kilolitre. Also ₹0.10 per litre as Urban Transport Fund and ₹0.25 per litre as Special Infrastructure Development Fee. VAT is 15.94 per cent and there is a 10 per cent additional tax on VAT. The government is facing an election soon. So they might have taken a political decision (to reduce the tax).

“But the case is not similar with other States,” a top Opposition leader who has initiated talks with various Opposition-led governments told BusinessLine.

Firm stand

But in the rest of the provinces, the Opposition is not ready to buckle down so soon.

The Andhra Pradesh government issued an advertisement saying that the Centre collected ₹3,35,000 crore as the central excise tax on petrol and diesel but it distributed only ₹19,475 crore as State’s share and also argued that the Centre collected ₹2,87,500 crore as cess and surcharges to avoid sharing it with the States. Telangana Chief Minister K Chandrashekar Rao on Sunday and said the State had not increased any taxes on petrol and there is no question of reducing any.

Others in the Opposition were still discussing ways to counter the BJP’s narrative.

The understanding was that the issue of additional duties would decidedly be taken up during the upcoming winter session of Parliament.

Sources in the Opposition parties told BusinessLine that the stand taken by the YSRCP and the TRS have brought strength to the Opposition camp.

‘No justification’

Kerala Finance Minister KN Balagopal, who had moved a statutory motion in Rajya Sabha in 2014 against imposing additional excise duty, told reporters in Thiruvananthapuram that there is no justification in imposing such high cess and surcharges.

He said it is a violation of Article 271 of the Constitution, which should be used only in the case of national calamities or exigencies.

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