BENGALURU: A day after Union Minister of State for Finance Anurag Thakur reiterated that fuel would be brought under the GST regime, Karnataka Home and Law and Parliamentary Affairs Minister Basavaraj Bommai has said that no such discussions have been held so far.
Bommai, also the state’s representative in the GST Council, said the issue of including fuel or liquor under GST was not brought to the GST Council or proposed to the states so far. He said it is unlikely that the states would agree to such a proposal considering fuel cess is a huge source of revenue for states.
Thakur, despite telling Lok Sabha earlier there was no proposal to bring fuel under GST, has been repeatedly saying that the Centre is hopeful of bringing fuel prices down if states agree to include fuel under GST. Karnataka has one of the highest sales tax (VAT) rates of 35% on petrol and 24% on diesel. In the budget 2020-21, tax on petrol was increased from 32% to 35% and on diesel from 21% to 24%.
But in the budget 2021-22, they were left untouched. The VAT is over and above the cess levied by the Centre.Following the Union Budget 2021-22, the Centre’s tax on fuel, including basic excise, surcharge, agri-infra cess and road/infra cess is currently Rs 31.83 per litre for diesel and Rs 32.98 for petrol. Karnataka had raised Rs 10,473 crore in 2020-21 from sale tax/VAT on fuel and Rs 164 crore in SGST.
“Excise and fuel are the last resort of any state when faced with a financial crunch. If that is also brought under the GST regime, the state’s dependence on the Centre will increase,” said a Finance Department official.
Rs 47.03 cr
Diesel subsidy to fishermen pending
The government told the Assembly that Rs 47.03 crore in diesel subsidy is yet to be paid to fishermen. Ports and Inland Water Transport Minister S Angara, in reply to a question from Congress MLA UT Khader, said Rs 30 crore of the Rs 77.30 crore in diesel subsidy has been released to fishermen. MLA Priyank Kharge, who asked the question on behalf of Khader, said 70% of boats have been lying idle at ports and deep-sea fishing has stopped due to the pending dues.